April 19, 2024
Binance Offers $5M Reward for Insider Trading Tips
Latest Cryptocurrency News

Binance Offers $5M Reward for Insider Trading Tips

Crypto exchange Binance has unveiled a reward program offering between $100,000 and $5 million for reports on potential insider trading or corruption within the exchange. This initiative comes amidst growing scrutiny over trading activities within the crypto market.

Binance made headlines on March 16 by announcing the listing of Book of Meme (BOME), a Solana-based memecoin, on its platform. The token was paired with prominent cryptocurrencies such as Bitcoin (BTC), Tether (USDT), First Digital USD, and the Turkish lira. Additionally, Binance Futures introduced a USDS-M BOME perpetual contract with leverage of up to 50x.

Before the listing, a significant transaction occurred on the Raydium decentralized exchange (DEX) where a crypto whale purchased 314 million BOME tokens for $2.3 million, averaging $0.0074 per token. Following the listing, the token’s value surged to a high of $0.026, resulting in the tokens being valued at approximately $8 million.

Book of Meme token price chart. Source: CoinGecko

However, the trade raised suspicions within the community, with some speculating about potential insider trading. Community discussions on platforms like Reddit questioned whether the trade was a fortunate coincidence or if the trader had access to insider information from Binance.

Responding to the allegations, Binance issued a statement confirming an investigation into the insider trading claims associated with the BOME listing. During the preliminary investigation, Binance stated that the individual in question had “no connection with Binance.”

Binance announcement on insider trading investigation. Source: Binance

Binance emphasized its commitment to maintaining transparency and urged the community to report any instances of potential insider trading or misconduct related to the exchange.

The exchange pledged to conduct thorough investigations into reported incidents and to publicly disclose its findings. By offering rewards for reporting misconduct, Binance aims to uphold a fair and transparent trading environment within the crypto market.

While some traders profited immensely from the surge in the Solana memecoin market, others missed out on potential gains. One trader, who purchased BOME tokens early on, sold 170 million tokens for $131 thousand a day before the token’s price skyrocketed. At current market prices, the tokens would have been valued at $2.3 million.

Image by pvproductions on Freepik

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