The world’s largest cryptocurrency exchange Binance was in the crossfire of critics for a long time after the collapse of FTX. In particular, there was harsh criticism due to the unclear reserve evidence issued by the audit firm Mazars, which suspended cooperation with the exchange shortly after.
However, by the end of the year, these criticisms have quieted down and Binance has faded from the spotlight as DCG and Genesis become the biggest heads in the crypto industry. But Conor Grogan, Head of Product Business Operations at Coinbase, presented a new serious accusation against Binance today.
On Twitter thread, Grogan wrote that there is a “Binance pattern going forward over 18+ months.” He found a wallet connected to Binance that bought $900,000 RARI seconds before the listing and spent minutes after.
They also found an incident where around 78,000 ERNs were bought between June 17 and 21 and sold immediately after the listing was announced. The same thing happened with TORN, where “hundreds of thousands were bought and sold after the announcement.”
Another example is buying RAMP, worth more than $500,000, for several days,” before sending it to Binance minutes after the listing announcement. It is estimated that he sold it for ~100K payday. Grogan explained:
I discovered all this through looking at the original wallet’s OKX deposit address and looking at other counterparty wallets. Not a great opsec by them. I just started digging for more examples.
According to the Coinbase exec, the front run can have various causes. Most likely, according to Grogan, it is an insider MNPI (Material Nonpublic Information) which is operated by a rogue employee who is connected to the listing team and has details of the new asset announcement.
Another explanation could be a trader finding a leak in the API or trading exchange test. In any case, regulators and law enforcement agencies tend to be very interested in the case, as evidenced by the recent case against Coinbase for insider trading.
Bitcoin Price Manipulated By Singe Entities On Binance?
In particular, rumors emerged last week that all Bitcoins moved from $17,000 to $21,000 started by an entity on Binance. First, an anonymous trader pointed out that the move was supported by the whale stablecoin BUSD, citing BTC Spot CVDs (Cumulative Delta Volume). On January 15, he shared the chart below and write:
The entire move from 17k to 21k was made by people on Binance aggressively buying Bitcoin with BUSD. Other exchanges started buying around 19.5k with USDT + USD. Green CVD includes all exchanges with Binance USDT as well, yellow CVD – only BUSD.
Yesterday, the trader wrote that both CVDs showed a bearish divergence of Bitcoin since yesterday. “Green line – CVD dot with all stablecoins including dear BUSD, blue line – CVD perps with all stablecoins too. Looks like passive seller wins this time,” the seller said said.
However, the trader also clarified that while he was the first to report a large BTC purchase with BUSD on Binance, he never mentioned the words “cartel” or “manipulation.”
At press time, Bitcoin price once again hit the $23,000 level.
Featured images from iStock, Charts from Twitter and TradingView.com