Note that in January 2023, the first verdict in the cryptocurrency insider trading case was announced. It involves the brother of a former employee of cryptocurrency platform Coinbase, who was leaked information about upcoming listings of certain tokens on the exchange. He would buy coins and then get rid of them on news and growth. Read more about the story here.

It's worth noting that the top cryptocurrency exchanges have been doing differently since April 2022. Here's a table comparing the proportion of staff cutbacks (in orange) and changes in trading volumes (in blue) since then.

Share of staff cuts and trading volumes at top cryptocurrency exchanges

As you can see, Binance did not lay off staff, but only increased staff. At the same time, the already mentioned Coinbase as a whole got rid of 40 percent of the team. As Coinbase CEO Brian Armstrong previously commented on the decision, the company was too active in hiring staff on a bullish trend, which led to too high costs. And that, in the current market environment, is fraught with problems.

How cryptocurrencies are breaking the law

Grogan has published the transaction history of several anonymous wallets over the past 18 months. They allegedly bought tokens that soon ended up listed on Binance, meaning they were added to the trading platform. Here’s his tweet.

I found wallets that:
– Bought Rari for $900k seconds before listing and sold the coins a few minutes after;
– Bought ERN for about $78k between June 17 and 21 and sold immediately after listing was announced;
– Did a similar strategy with TORN.

Thanks to this, it becomes clear that the owner of the wallet was focused directly on certain news from the Binance exchange. Well, the strategy was to buy tokens in a timely manner and quickly dump them after the market reacted to the listing announcement. If this was done in the presence of certain non-public information, such actions are illegal.

Transactions with ERN tokens

In the latter case, hundreds of thousands of dollars worth of TORN tokens were purchased and sold immediately after listing.

Transactions with TORN tokens

According to Cointelegraph’s sources, a certain anonymous person also purchased nearly half a million dollars worth of RAMP tokens before adding them to Binance. The token deal already after the listing brought him about $100,000 in profit over a short period of time.

Buying RAMP tokens

Grogan sees a couple of explanations for what happened.

– An insider information leak, most likely from an unscrupulous exchange employee associated with the people directly involved in the asset listing;
– An outside trader discovered leaking information from some API or other exchange sources.

Announcement of Ramp token listing

The accuracy of the trades and timing suggests that wallet holders had a clear idea of the specifics of the listing on Binance, i.e. further developments within the trading platform. The exchange is most likely not involved in this case, as it earns huge commissions on users’ transactions, so the management will definitely not risk its reputation for the sake of hundreds of thousands of dollars.

That said, there may indeed be problems with its individual employees who allow information to be leaked. So far, the trading platform’s officials have not commented on the allegations of possible insider trading.


Not long ago, Binance announced a 90-day token sale policy for employees, prohibiting them or their family members from selling any newly added assets to the exchange within that timeframe. This is an important detail - if the source of the leaked information is disclosed, Binance management will do everything to absolve itself of responsibility and bring the guilty employee to justice.

It should be noted that Binance actively cooperates with global regulators, so possible future actions of the exchange do not raise doubts. For example, as it turned out some time later, it was Binance that helped shut down the trading platform Bitzlato, whose founder Anatoly Legkodimov was arrested the day before in Miami. Representatives of the platform confirmed the relevant information. They also added that in this way they expect to have a good relationship with regulators and improve the reputation of the exchange along with the entire digital asset industry.


Changpen Zhao, head of cryptocurrency exchange Binance


We believe that such cases could indeed be due to the activity of unscrupulous employees of the trading platform or data leaks through APIs. However, they are quite old, as the interaction with RGT, for example, took place in November 2021. Accordingly, the problem may have already been resolved. Anyway, it remains to wait for comments from exchange representatives - or the results of the investigation, if any.


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