An employee of Binance, who held a business development position in BNB Chain, used confidential information for insider trade.
On March 23, the Binance internal audit team received a complaint about one of the employees of Binance Wallet, which previously held a business development position in BNB Chain. During the investigation, it turned out that he used confidential information from his previous place of work for the sake of personal benefit.
Details of the incident
The offender knew that the popular project was preparing for the generation of tokens. Before the official announcement of the event, he used several wallets to buy coins of this project. After the announcement of the launch, the employee of Binance Wallet sold part of the assets, fixing a significant profit.
Representatives of Binance noted that the investigation did not reveal the facts of insider trade inside the wallet team itself. At the time of the incident, the Binance Wallet unit did not have a business relationship with the project mentioned in the complaint, so it should not have access to closed information about it.
What kind of project are we talking about – Binance was not specified.
The cryptocurrency rebel removed the offender from work. His actions qualified as front-line (from the English Front-Running)-this is illegal trade based on insider information.
Binance is going to confiscate all illegally received assets and transfer the matter to the authorities. Four informants who were the first to report a violation paid $ 100,000 in total.
Community assumptions
Binance did not reveal who exactly stood for insider trade. The crypto community decided to find out on its own. Some users claim that the violator was Freddy NG, who recently earned more than $ 100 thousand on the UUU token.
It is reported that he spent about $ 6 thousand on the purchase of 24.1 million UUU (2.4% of the total offer). During a sharp growth, NG sold 6 million UUU, having a profit of $ 113 thousand. The remaining coins – about 18.1 million UUU for a total of $ 200 thousand – remained on its nine wallets.
Many participants in the crypto community fell on Binance with criticism.
The cryptocurrency was repeatedly accused of insider trade. In February last year, a scandal flared up against the background of the listing Ronin (Ron). Analysts later noticed a suspicious transaction the day before the Book of Meme (BOME) Memcoin listing.
Against the background of Binance charges, it tightened the rules for adding new coins to the platform. For information on unlawful actions of employees, the site promised to pay from $ 10 thousand to $ 5 million.
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Source: Cryptocurrency
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