Major cryptocurrency exchanges, Binance and Bitget, have initiated investigations into the trading activities surrounding RaveDAO's RAVE token after allegations of insider-orchestrated price manipulation surfaced. The claims, brought forth by on-chain analyst ZachXBT, suggest that insiders deliberately engineered a short squeeze, resulting in the token's rapid appreciation. In response, Bitget's CEO, Gracy Chen, confirmed that the exchange has started investigating the matter, while Binance's CEO, Richard Teng, publicly stated that the platform is also examining the claims and is committed to investigating 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 private information regarding the parties involved. The RAVE token's price surge led to the liquidation of over $44 million in short positions, with the token's value increasing by 4,500% over the course of a week. However, the token's price has since receded, with its market value briefly exceeding $6 billion before dropping by more than 50% from its peak.
The investigation has highlighted the concentration of RAVE tokens within a small set of wallets, with nearly 90% of its supply held in just three Gnosis Safe wallets at the time of the price surge. Furthermore, millions of tokens were transferred to exchanges shortly before the price jump, raising suspicions of potential market manipulation. RaveDAO, which presents itself as a Web3 project focused on electronic music events, has reported revenue of approximately $3 million in 2025. The project's token, RAVE, had traded below $0.50 for most of its history before surging in April, with its price jumping from around $0.30 to over $6 in a single day before reaching a peak of over $27.
The token's market behavior has raised concerns, with some describing a 'bait and liquidate' pattern, where visible transfers suggest selling pressure, drawing traders into short positions, only to have those tokens later withdrawn, forcing short sellers to buy back at higher prices. While these claims remain unproven, the concentration of supply suggests that this scenario is a real possibility.
RaveDAO has addressed the situation, stating that the team is not responsible for the recent price action, but has not directly addressed the on-chain allegations. The project has confirmed plans to liquidate portions of unlocked tokens 'when appropriate' and is exploring models that tie team incentives to ecosystem growth.