Movement Network commits $38 million to token buyback
The organization behind the Movement Network said it will use $38 million recovered from a market maker to buy back MOVE tokens over the next three months.
On March 24, the Movement Network Foundation said it recovered about $38 million in assets from a market maker tasked with providing liquidity on buy and sell orders for the Movement (MOVE) token on Binance.
Binance offboarded the market maker due to “market irregularities.” The exchange sanctioned the market maker, freezing its proceeds and forbidding it from further market-making activities.
Market makers provide liquidity to crypto tokens to attract traders and stabilize their prices. These entities are tasked with providing liquidity on both buy and sell orders to ensure the smooth operation of crypto exchanges.
Binance investigates market irregularities
According to Binance, the market maker sold 66 million MOVE tokens after the token was listed, while placing “little” in buy orders. These trades netted the market maker $38 million in Tether (USDT) from their trades.
Binance said it froze the profits and informed the Movement Network Foundation of the incident.
The foundation said it had “severed all relationships” with the market maker and had recovered the frozen funds from the market maker’s rogue actions, which it said it would use in a buyback program: “All cash proceeds recovered from the Market Maker will be used by the Movement Network Foundation to establish the Movement Strategic Reserve: a 38M $USDT buyback program to purchase $MOVE for long-term use and to return the USDT liquidity to the Movement ecosystem.”
The organization also shared a wallet address for its “Movement Strategic Reserve,” to which the purchased MOVE tokens will be transferred periodically.
The incident follows another Binance action against an affiliated market maker on the exchange. On March 9, Binance announced that it had offboarded market makers for projects GoPlus Security and MyShell. The exchange said it had confiscated the project’s proceeds and would make a compensation plan for its users.
Apart from market makers, the exchange recently suspended a staff member for alleged insider trading. On March 25, Binance launched an investigation on a member of its Binance Wallet team after receiving a complaint that the employee had been front-running trades.