Binance Suspends Staffer Over Alleged 100% Insider Trading Profits

Binance, a prominent cryptocurrency exchange, has taken swift action by suspending a member of its Binance Wallet team following an internal investigation into allegations of insider trading. The investigation was initiated on March 23 after receiving a complaint that suggested a staff member had engaged in front-running trades using insider information to gain improper profits.

The preliminary findings of the investigation indicated that a staffer, who had recently joined the Binance Wallet team from a business development role at BNB Chain, was suspected of using non-public information to "front-run" trades of a project token. The staffer was allegedly aware of an upcoming Token Generation Event (TGE) for the project, which was expected to generate significant community interest.

According to the investigation, the staffer used multiple linked wallet addresses to purchase a large volume of the project’s tokens before the public announcement of the token launch. Following the announcement, the staffer quickly sold part of their holdings to realize significant profits. This behavior is a clear violation of company policy, as it involves using non-public information for personal gain.

Binance Wallet has accused the staff member of front-running trades based on non-public information gained from a previous role, which is a breach of company policy. The staffer has been suspended immediately and is pending further disciplinary action. The company has also stated that it will cooperate with authorities in the relevant jurisdiction to take legal action if necessary.

The company did not name the staff member but noted that the allegations circulating on social media prompted the investigation. Earlier this week, multiple users pointed to a former operations manager at BNB Chain, whose LinkedIn profile shows he joined Binance Wallet’s business development team last month. One of the wallets that profited from the token in question is allegedly linked to this individual.

Binance Wallet has expressed appreciation for the public efforts in bringing this matter to light but has emphasized that it will only reward those who submit reports to a whistleblowing email to protect whistleblowers’ interests. The company has announced that it will hand out $100,000 equally distributed among four anonymous whistleblowers who emailed the exchange with relevant information.