Coinbase Executive Accuses Binance Of Price Manipulation• January 23, 2023 9:30 pm • Comments
Binance has already been a long time target for a lot a criticism where many within the crypto industry had accused the exchange of lacking a proof of reserves.
The concern gained a lot of attention as its auditing firm, Mazars, had actually stopped working with the exchange which raised some suspicion.
The latest criticism now comes from Coinbase executive Conor Grogan who is the Head of Product Business Operations at Coinbase.
Grogan accused Binance of exchange price manipulation where he stated that there seems to be a pattern of Binance doing front-running activities for the past 18 months.
On his Twitter, he mentioned that he had found wallets that had supposedly been used for this front-running and listed a few examples.
— latenite_News (@latenite_news) January 23, 2023
He also found an incident where around 78,000 ERNs were bought between June 17th and 21st and sold immediately after the listing was announced. The same thing was done with TORN, where “hundreds of thousands were bought and sold right after the announcement.”
Another example is the purchase of RAMP, worth more than $500,000, of over multiple days, “before sending it to Binance minutes after the listing announcement. Assuming they sold it was a ~100K payday.” Grogan explained:
I found all of these via looking at the original wallet’s OKX deposit address and looking at the other counterparty wallets. Not great opsec by them. I just started digging in so there might be more examples.
According to the Coinbase exec, the front-running could have a variety of causes. Most likely, according to Grogan, is insider MNPI (Material Nonpublic Information) which is operated by a rogue employee who is connected to the listing team and has details of new asset announcements.
So far, Binance has not responded to these allegations by the Coinbase executive and there has not been any law enforcement agencies looking into it yet.
After all, it seems that Binance has already been operating the way it has for 18 months, but investigators may take new interest in the case if what Grogan is saying happens to be true.
Coinbase itself is also not free from similar accusations as the exchange itself was also accused for insider trading.
A lot of these cases seem to be extremely common among top crypto firms and this may be a part of law enforcement agencies plan to regulate the industry more strictly.
Given that Binance is the largest exchange by volume so far, many also speculate on the future price of crypto assets like Bitcoin using Binance’s data.
For example, speculations are now coming out that the recent bull rally may have been started from whales on the exchange.
Here's another related wallet. Purchases $500K+ of RAMP over a few day period, before sending it to Binance minutes after the listing announcement. Assuming they sold it was a ~100K payday
— Conor (@jconorgrogan) January 23, 2023
Whole move from 17k to 21k was made by someone on Binance aggressively buying Bitcoin with BUSD.
Other exchanges started to buy 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 are showing a Bitcoin bearish divergences since yesterday. “Green line – spot CVD with all stablecoins including our loved one BUSD, blue line – perps CVD with all stablecoins as well. Looks like passive seller won this time,” the trader said.
However, the trader also clarified that while he was the first to report the huge BTC buying with BUSD on Binance, he never mentioned the words “cartel” or “manipulation.”
At press time, the Bitcoin price was once again attacking the $23,000 level.
Here is the 6th suspicious transaction I found
— Conor (@jconorgrogan) January 23, 2023
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