Changpeng Zhao, Binance CEO, responded to a Twitter thread highlighting some 16 instances of insider trading on Binance.
Binance insider trading
Insider trading continues to affect the crypto exchange network Binance. Recently, Zhao responded to claims of insider trading on Binance.
On March 28, a crypto enthusiast and analyst, Fatman (@FatManTerra), released a Twitter thread detailing several instances of insider trading affecting Binance. This thread highlights a pseudonymous individual who participated in frontrunning pumps of multiple altcoins on Binance, earning a seven figure profit in the process.
The wallet 0xd23 received $53,000 and bought FXS on Uniswap spacing transactions in small batches. Three days later, the Binance exchange listed the FXS token leading to massive price surges.
The investors sent tokens to Binance and amassed profits.
Another wallet owned by the same trader, 0x51, bought about 131 ETH of TVK. A few days later, Binance listed TVK, causing a price surge. The trader cashed out around 277 ETH.
You might also like: Voyager acquisition put on hold with CFTC Binance suit underway
The thread only mentioned two cases. However, it brought light to an article written in January that exposed about 16 cases of insider trading on Binance.
According to reports, the total number of gains amassed in the instances was nearly $1.4 million. The relationship between the insider trader and Binance is unknown, but he had insider info.
When responding to the tweet, Changpeng Zhao noted that they identified the address and around $2 million associated with it. The CEO noted that the account holder never asked for reclaim after freezing.
Furthermore, Zhao mentioned that the exchange constantly fights risks that could lead to insider trading. He invited others to help point out such instances in the future.
Insider trading causes some problems for retail investors, leading to a loss of profits. Furthermore, such unethical trades could make some possibly profitable markets unprofitable.
The insider trading claims surface as the exchange faces a suit from CFTC.
Read more: XRP price rises to an 11-month high despite Binance clash