Insider Trading Rampant in Crypto Market, Study Shows
A recent study conducted by Solidus Labs has revealed that insider trading in the cryptocurrency market is much more widespread than previously believed. The study focused on crypto assets listed on major platforms and exchanges and found that serial insider traders systematically exploited token listings and announcements for personal gain.
Key Points:
- 56% of crypto token listings on centralized exchanges since 2021 showed signs of insider trading.
- Over 100 entities or groups of connected wallets were identified as executing over 400 suspected insider trades.
- 51 entities used decentralized exchanges (DEX) to swap Ethereum, Tether, or USDC to buy soon-to-be-listed crypto tokens on multiple occasions.
- Three individuals traded ahead of more than 25 token listing announcements each.
- The study confirms that DEX-based insider trading is a significant market integrity issue that can be addressed through blockchain technology.
Hot Take:
This study sheds light on the prevalence of insider trading in the cryptocurrency market, highlighting the need for increased regulation and transparency. The use of blockchain technology can play a crucial role in detecting and deterring insider trading, ultimately making crypto trading safer for all participants.
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