Major cryptocurrency exchanges Binance and Bitget have initiated investigations into the trading activity surrounding RaveDAO's RAVE token, prompted by allegations from on-chain analyst ZachXBT that insiders manipulated the market, resulting in a significant short squeeze and rapid price increase. The claims suggest that the token's 4,500% surge was artificially engineered.
In response to these allegations, Bitget's CEO, Gracy Chen, confirmed that the exchange has begun investigating the matter, while Binance's CEO, Richard Teng, stated that the platform is also examining the claims and will take necessary actions to address any signs of market misconduct. Another exchange, Gate, was also implicated in ZachXBT's investigation. To encourage whistleblowers to come forward, ZachXBT has offered a $10,000 bounty for anyone who can provide evidence about the parties involved. The RAVE token's sudden and significant price increase led to the liquidation of over $44 million in bearish positions in a single day, highlighting the concentration of tokens within a small set of wallets.
Notably, nearly 90% of the token's supply was held in just three Gnosis Safe wallets at the time. Furthermore, investigators identified token transfers to exchanges shortly before the price surge, with millions of tokens being moved to these platforms. RaveDAO, a Web3 project focused on electronic music events, has been at the center of this controversy.
The project offers blockchain-based ticketing and community governance, having originated from a 2023 afterparty in Istanbul and since hosted events across several regions, generating approximately $3 million in revenue in 2025. However, the token's market behavior has been highly volatile, trading below $0.50 for most of its history before surging in April.
The token's price jumped from around $0.30 to over $6 in a single day, eventually reaching a peak of over $27 before starting to decline. At its peak, the token's market value briefly exceeded $6 billion, placing it among the largest cryptocurrencies by market capitalization before dropping. Currently, the token is down more than 50% from its peak and 30% over the last 24 hours.
A separate claim suggests a 'bait and liquidate' pattern, where visible transfers are used to create the illusion of selling pressure, drawing traders into short positions. If those tokens are later withdrawn while prices rise, short sellers may be forced to buy back at higher prices, driving further gains for those on the other side of the trade. Although these claims remain unproven, the concentration of supply suggests it's a plausible possibility.
Community reports have also linked the project to individuals associated with earlier crypto ventures, including ARPA and Bella Protocol, though these connections have not been independently verified. In response to the situation, RaveDAO addressed the community in a social media thread, stating that the team is not responsible for the recent price action. However, the team did not address specific on-chain allegations, including supply concentration or the millions of tokens transferred to exchanges ahead of the price surge. Instead, RaveDAO confirmed plans to liquidate portions of unlocked tokens 'when appropriate' and is exploring models that tie team incentives to ecosystem growth, including price-triggered or performance-triggered locks.
The project stopped short of committing to any specific mechanism or timeline. CoinDesk has reached out to RaveDAO for further comments.