A Rough Patch for Movement Labs
Straight Up Truth
Co-founder of Movement Labs temporarily suspended amid market maker scandal
Movement Labs, a buzzing Ethereum layer-2 startup, finds itself in hot waters.
In the midst of a swirling storm, co-founder Rushi Manche has found himself on the hot seat. The company announced his suspension on the X as they grapple with the fallout from a questionable token deal that saw 66 million MOVE tokens make a beeline for the open market, setting off internal and public pandemonium.
The no-holds-barred announcement reads:
The suspension comes hot on the heels of reports suggesting that Movement Labs entered a shady market-making agreement with Rentech, a facade company posing as a subsidiary of Chinese firm, Web3Port. The devious duo allegedly misrepresented their roles and unloaded their entire token stash within a day of MOVE’s launch.
Inner communications, exposed by CoinDesk, indicate that Rentech appeared on both sides of the shady agreement, identifying as Web3Port's representative and as an agent representing Movement Labs, itself.
According to reports, Manche played a decisive role in pushing forward the iffy deal despite red flags, legal concerns, and conflict warnings.
Manche has yet to whisper a word in response to our query for a comment.
Ricocheting back to the legal trenches, the Movement Foundation's legal counsel labeled the shady agreement as a profoundly problematic mess. Somehow, this deal found its way into the green light zone. And within a day of MOVE's debut on December 9, the 66 million tokens were auctioned off to the highest bidder, CoinDesk reports.
Fingers are pointed at Groom Lake, a crypto asset intelligence agency, for conducting a thorough probe into Manche's role in advocating for the underhanded deal.
Binance kicked the market-maker responsible for the MOVE dump to the curb back in late March, taking aim at misconduct and clamping down on the $38 million profits gained from the dump. The trading giant accused the shadowy entity, widely recognized as Rentech, of flooding the platform with sell orders without providing substantial buy support.
In stark contrast, Movement Labs insisted the dump against their will, without their approval, and in direct defiance of their agreement.
The regrettable sequence of events took a darker turn on May 15 when crypto exchange Coinbase announced it would halt MOVE trading, citing a routine asset review. In the wake of the bombshell announcement, MOVE dropped a harrowing 14%, plunging to $0.20, its lowest ever, and sinking 21% on the day, according to Coingecko's data.
A member of the project's Telegram group, going by the handle Merq, confirmed Manche’s suspension and advised the community to await the Groom Lake's investigation's results.
- Movement Labs, a vibrant Ethereum layer-2 startup, is facing turbulent times, with co-founder Rushi Manche under suspension.
- The company's suspension was announced due to a questionable token deal, where 66 million MOVE tokens were rapidly sold, causing internal and public upheaval.
- Reports suggest that Movement Labs entered a suspicious market-making agreement with Rentech, a company posing as a subsidiary of Web3Port.
- Rentech is accused of misrepresenting their roles and dumping their entire token stash within a day of MOVE’s launch.
- Inner communications revealed that Rentech was on both sides of the shady agreement, representing both Web3Port and Movement Labs.
- Manche is accused of pushing forward the shady deal despite red flags, legal concerns, and conflict warnings.
- The crypto exchange Coinbase has halted MOVE trading, citing a routine asset review, and the trading token has hit a record low, sinking 21% on the day.
