Renowned cryptocurrency exchange, Binance, has recently uncovered the market maker behind the massive MOVE token sale. The implicated market maker allegedly dumped millions of MOVE tokens shortly after its launch, leading to a halt in the entity’s profits.
In a declaration made on Tuesday, Binance confirmed that the actor was linked to another market maker for GPS and SHELL, which were disassociated from the platform on March 9 due to misconduct. The firm further alleged that the market maker sold approximately 66 million MOVE tokens a day after it was listed on December 10, with minimal buy orders. This entity netted a profit of 38 million USDT before being ousted from Binance on March 18.
Binance informed Movement Labs and Movement Foundation teams of the irregularities with their market maker and froze the proceeds for compensating the users. The exchange stressed that all authorized market makers on the platform must place orders for both bid and ask, ensure sufficient order size, maintain a stable market spread, and retain orders for a specific amount of time.
Following Binance’s announcement, the MOVE token saw a 7% increase, reaching $0.46, as per The Block’s Movement Price page.
In a separate notification, Movement Network Foundation admitted that Binance alerted them about an ongoing investigation into the market-making activities involving MOVE on March 11. The foundation stated that they were unaware of these activities and opted to collaborate with the market maker as they had previously supported projects within the Movement ecosystem.
The foundation showed gratitude to Binance for its investigation, adding that the entity acted against the project’s wishes and violated its agreement that required it to provide liquidity on both sides of the MOVE/USDT pair.
Upon receiving information about the activity from Binance, Movement Network Foundation severed all ties with the market maker and informed other crypto exchanges about the investigation. It then cooperated with Binance to recover the funds and pledged to use them for buying back MOVE on public markets.
All recovered funds will be used by the Movement Network Foundation to establish the “Movement Strategic Reserve” — a 38 million USDT buyback program to purchase MOVE for long-term use and return the USDT liquidity to the Movement ecosystem. The buyback program will take place over the next three months on Binance, with purchased MOVE tokens periodically transferred to the Movement Strategic Reserve’s onchain wallet.
Despite the potential influence of the buyback and reserve on price, it remains unclear how the program directly compensates users affected — the stated purpose of Binance freezing the funds initially.
Movement Labs extends the use of the Move programming language beyond the popular Aptos and Sui Layer 1 blockchains. Although it uses Ethereum for security, the network is not a Layer 2 chain and is more aptly defined as a fast finality rollup or a sidechain, according to Movement Labs co-founder Rushi Manche.
The Move was originally developed at Meta by a team from Facebook’s now-inactive Diem stablecoin project.
