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Binance, the cryptocurrency exchange that was recently fined a record $4.3 billion by the U.S. Department of Justice, has reportedly fired an executive/employee who exposed a manipulation by the company DWF Labs. DWF Labs is alleged to have made $300 million in profits from the manipulation. DWF Labs has denied the allegations.
Significant allegations have been made about Binance, which is facing difficulties in the US, has paid a historic fine, and its former CEO CZ has been sentenced to 5 months in prison, and DWF Labs, which is known for its investments in cryptocurrencies.
According to a report by Wall Street Journal in the US media, Binance’s Crypto Surveillance Team detected a manipulation by DWF Labs. Binance terminated the employment of the executive/employee or employees who exposed this manipulation. The report also stated that DWF Labs made $300 million in profit in 2023 through fake volumes, also known as “wash trade.”
Looking at the news, it appears that Binance management would not want DWF Labs’ manipulation to be exposed. Binance has not yet made a statement on the matter as of 13:00 TSİ.
DWF Labs has issued a statement denying the allegations, saying that “the vast majority of the allegations are distorted and baseless.”
Was the fired executive working with DWF’s competitors?
The WSJ report also stated that 2/3 of Binance’s volume is provided by VIP customers, and the following statements were used:
“Binance was getting 2/3 of its volume from VIP customers. The surveillance and tracking team had taken the Tron Foundation out of the VIP customer group. However, there were growing suspicions about DWF in recent times. However, Binance’s compliance manager was not happy with these complaints. He didn’t think there was enough evidence. The compliance manager also believed that the tracking team was close to DWF’s competitors. Later, the executive responsible for the tracking team was fired.”
The WSJ report also stated that Binance determined that DWF Labs, together with YGG, also manipulated a total of 6 tokens. It was stated that DWF Labs sold 5 million tokens at the peak prices of 2023.
However, Binance management thought that DWF’s transactions were actually problem-free buys and sells. There was an allegation that this was not manipulation. Binance thought that the real fraudster was the tracking executive who was “working with DWF Labs’ competitors.”