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Binance, one of the leading cryptocurrency exchanges, has unveiled a $5 million bounty program seeking information about potentially corrupt employees. This move comes in response to a controversy surrounding the listing of the Ronin (RON) token.
Accusations and Controversy
In a series of posts on February 5, Binance co-founder Yi He acknowledged the "heated discussions" within the community following a significant drop in the price of Ronin (RON) shortly after its listing on the exchange. Some community members speculated that a leak from within Binance may have caused this price drop. However, Yi He explained that users discovered blockchain data indicating Binance's preparations for the token's listing.
RON, the native token of the gaming-focused blockchain platform Ronin, had witnessed a price increase of over 30% in the week leading up to its Binance listing announcement, according to CoinGecko data. However, it experienced an 18% drop within an hour after Binance confirmed the listing and is down more than 26% on the day.
This incident occurred just two weeks after Coinbase director Conor Grogan claimed to have identified multiple wallets exhibiting a pattern of purchasing tokens shortly before they were listed on Binance and then selling them after the announcements. Grogan speculated that these wallets could belong to a "rogue employee connected to the listings team" or a trader who had access to test trade information on the exchange.
The Bounty Program and Enhanced Measures
In response to these concerns, Yi He announced a significant overhaul of Binance's token listing process. This includes the introduction of a bounty program offering rewards ranging from $10,000 to $5 million for verified information on corrupt staff members, surpassing the potential gains from the "rat warehouse."
Members of the Binance team involved in the token listing process will now face stricter controls, and any leaked information regarding upcoming projects will result in a warning for first-time offenders and termination for repeat offenders.
Furthermore, Binance will blacklist projects that hire staff members dismissed from the exchange due to corruption. Projects seeking listings will be encouraged to contact Binance for background checks.
To enhance security, Binance will tighten its external communications, and token listings may be canceled if any listing information is leaked prematurely. The exchange also aims to improve technical monitoring to prevent automated scripts from reacting to listing announcements.
This series of measures reflects Binance's commitment to maintaining integrity and transparency in its operations, as it seeks to address concerns raised within the community regarding token listings and potential insider trading.