Movement Labs Suspends Co-Founder Amid $38M Token Dump Scandal
By: cryptosheadlines|2025/05/02 23:00:05
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Airdrop Is Live CaryptosHeadlines Media Has Launched Its Native Token CHT. Airdrop Is Live For Everyone, Claim Instant 5000 CHT Tokens Worth Of $50 USDT. Join the Airdrop at the official website, CryptosHeadlinesToken.com Movement Labs has suspended its co-founder, Rushi Manche, in the wake of a growing controversy tied to a high-stakes market-making agreement that triggered a dramatic collapse in the price of its native MOVE token. The company made the announcement in a post on X on May 2, citing “ongoing events” as the reason for the decision, which closely follows Coinbase’s announcement that it will suspend MOVE on May 15 due to the token’s failure to meet listing standards.Market Maker Deal Sparks Leadership FalloutAt the center of the controversy is a deal brokered by Manche with Rentech, which subsequently involved crypto market maker Web3Port. This agreement granted Web3Port 66 million MOVE tokens — roughly 5% of the total supply. What followed was a swift and brutal dump of those tokens into the open market, inflicting $38 million in downward price pressure and sending MOVE spiraling to an all-time low of $0.185 in December 2024.Movement Labs has since launched an independent investigation, spearheaded by private intelligence firm Groom Lake, to audit the events and determine potential misconduct or negligence.The Movement Labs debacle is only the latest in a string of controversies involving crypto market makers and their often opaque influence on token economics. A summer 2024 industry report indicated that 78% of new token launches since April had been marred by poorly structured listings, with market makers frequently at the center of the issues.Crypto Market Makers Under the MicroscopeThe pattern is growing harder to ignore. From allegations against Wintermute in the Celsius case to Fracture Labs’ lawsuit accusing Jump Crypto of orchestrating a pump-and-dump scheme using its in-game token, DIO, the role of market makers is increasingly being questioned. Even Binance-affiliated DWF Labs faced claims of inflating trade volumes by $300 million — though both parties denied wrongdoing.And it’s not just accusations flying. Regulatory heat is rising too: CLS Global was recently fined for volume manipulation in Massachusetts, and the founder of Gotbit, a self-described hedge fund and market maker, now faces market manipulation charges after being extradited to the U.S.With token launches becoming high-stakes battlegrounds, Movement Labs’ internal shakeup could be the start of broader scrutiny in the crypto space.Source link
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