Binance Suspends Employee for 66% Gain Front-Running, Bans Market Maker for $38M Profit

Binance, a leading global cryptocurrency exchange, has taken stringent measures against an employee who allegedly exploited insider information for personal gain. The individual, who previously worked in business development at BNB Chain, was found to have engaged in front-running trades by purchasing a substantial amount of tokens through multiple wallet addresses before a Token Generation Event (TGE). Post-launch, the employee sold some tokens to secure early profits while retaining a significant portion with unrealized gains.

The exchange's investigation uncovered that the employee had knowledge of an upcoming token launch and used this privileged information to their advantage. In response, Binance suspended the employee and initiated a formal disciplinary process. The exchange also expressed its readiness to collaborate with authorities for potential legal action. Binance emphasized its zero-tolerance stance on misconduct and announced plans to bolster internal controls and refine policies to prevent similar incidents in the future.

In a separate incident, Binance discovered irregular trading activities involving an unnamed market maker associated with the MOVE token. This entity was found to have dumped approximately 66 million MOVE tokens just a day after the token's launch, with minimal or no buy orders. By the time the account was removed from the platform, it had accumulated an estimated $38 million in profit. Binance promptly froze these earnings and banned the market maker from future activity.

Binance informed Movement Labs and the Movement Foundation about the misconduct, both of which were unaware of the irregularities. Following the disclosure, the project severed ties with the involved party and committed to compensating affected users. The Movement Network plans to repurchase MOVE tokens using the $38 million recovered, with the buyback occurring over the next three months on Binance. The repurchased tokens will be transferred to the Movement Strategic Reserve.

Binance has also encouraged users to report any unethical actions through its whistleblower portal. As part of this initiative, the company will distribute a $100,000 reward to four whistleblowers who provided valid reports on this case. This move underscores Binance's commitment to maintaining the integrity of its platform and ensuring a fair trading environment for all users.