Binance responds to WSJ report, denies DWF Labs market manipulation

This afternoon, the Wall Street Journal published an in-depth article accusing Binance of ignoring DWF's suspected market manipulation, but Binance and DWF Labs officials subsequently denied the report.

Related reading: "WSJ Exclusive Exposure of DWF's Suspected Market Manipulation, Binance Involved"

The following is the original text published by Cointelegraph (original in English):

Binance denied the latest allegations of DWF Labs' suspected market manipulation.

Allegations of DWF Labs' suspected market manipulation have reappeared. According to a May 9 report by The Wall Street Journal, an anonymous source claiming to be a former Binance insider stated that Binance investigators discovered $300 million worth of DWF wash trading during 2023.

When asked about the market manipulation incidents, Binance denied the reports. A Binance spokesperson told Cointelegraph:

“Binance strongly denies any suggestion that its market surveillance program allows market manipulation on our platform. We have a robust market surveillance framework that identifies market abuse and takes action. Any user who violates our Terms of Use will be removed; we will not tolerate market abuse.”

According to the Wall Street Journal, DWF Labs manipulated the price of the Yield Guild Game (YGG) token and at least six other cryptocurrencies last year. However, Binance said its surveillance program would make this impossible.

A Binance spokesperson told Cointelegraph that Binance is actively banning traders who show signs of market manipulation:

“Over the past three years, we have shut down nearly 355,000 users for violating our Terms of Use, with over $2.5 trillion in trading volume.”

Investigating potential market manipulation is a top priority for Binance, the world’s largest exchange, and independent investigations have proven this, with the Binance spokesperson adding:

“A recent independent investigation by Inca Digital into Binance’s market surveillance practices validated the effectiveness of our methodology, finding ‘minimal signs of unusual trading activity.’”

DWF Labs, a Web3 investment and market-making firm, was first hit with market manipulation allegations last September after a surge in on-chain activity caught the attention of crypto investors.

Wintermute, an algorithmic trading firm and market maker, was one of the first to accuse DWF Labs of manipulating crypto markets.

In a September interview with Token2049, Wintermute co-founder Yoann Turpin said DWF Labs “is not a market maker in our sense” and confuses users because they “declare what are essentially (over-the-counter) transactions as investments.”

DWF Labs co-founder Andrei Grachev has strongly denied the allegations.

「Original link」