Binance has pushed back against allegations of market manipulation involving DWF Labs.
The controversy surrounding DWF Labs resurfaced with claims of substantial wash trading amounting to $300 million in 2023, as reported by The Wall Street Journal on May 9, citing an anonymous source purporting to be a former Binance insider.
Addressing the accusations, Binance vehemently denied any involvement or oversight in permitting market manipulation on its platform.
A spokesperson for Binance highlighted the robustness of its market surveillance framework, which is designed to identify and take swift action against any form of market abuse.
The spokesperson reiterated Binance’s zero-tolerance policy towards such activities, asserting that users found in breach of the platform’s terms of use are promptly removed.
The Wall Street Journal report pointed to the alleged manipulation of the Yield Guild Game (YGG) token and several other cryptocurrencies by DWF Labs in 2023.
However, Binance countered these claims by asserting that its surveillance program is equipped to detect and prevent such illicit activities.
Binance disclosed its proactive measures in combating market manipulation, including the expulsion of nearly 355,000 users over the past three years, with a cumulative transaction volume exceeding $2.5 trillion, for violating platform terms.
Investigating and thwarting potential market manipulation remains a paramount focus for Binance, the world’s largest exchange.
The exchange highlighted independent investigations, such as the recent assessment by Inca Digital, which validated the effectiveness of Binance’s market surveillance practices by identifying minimal signs of anomalous trading activities.
DWF Labs, a Web3 investment and market-making firm, faced similar accusations of market manipulation in September 2023, following suspicious on-chain activities.
Wintermute, an algorithmic trading firm and market maker, was among the first entities to raise concerns about DWF Labs’ practices, alleging confusion between over-the-counter trades and investments.
