Binance’s listing of Solana-based meme coins with low market caps has raised concerns that pump-and-dump strategies are being triggered in the markets. In the crypto community, the fact that many of the meme coins listed by Binance have seen significant price increases has raised suspicions of insider trading.
Leonidas, co-founder of the Bitcoin Ordinals project, criticized Binance’s latest move, stating that this move only creates an advantage for those with insider information, at the expense of retail investors.
Binance's Meme Coin Listing Creates Crisis
Binance-listed Solana-based meme coins The AI Prophecy (ACT) and Peanut the Squirrel (PNUT) have seen extraordinary price increases since their listing on November 11. ACT’s value increased by 1,000%, reaching a market cap of $400 million in a short time, while PNUT gained 300%. These sudden price increases have led to allegations of pump and dump strategies that benefit only a select group of traders. This paints a worrying picture, especially for retail investors.
Market Response and Ethical Questions
Although the increase in value is considered an indication of a successful listing, there are question marks about the intentions behind Binance’s listing decisions. According to the allegations, Binance may have received a high fee to list these coins. However, Binance co-founder Yi He denied these claims, stating that they did not charge any listing fees for either token. Still, skepticism among investors continues.
Analysts have noted that a large portion of the recently listed meme coins have seen significant price increases. Of the last 15 meme coins, 12 have seen their prices increase by up to 200% after listing. This may indicate a manipulative strategy that seeks to serve the interests of certain groups rather than simply ensuring market stability.
Call for Greater Openness and Regulatory Measures
Following the growing concerns, Leonidas launched a petition to urge Binance to ensure transparency and openness. The petition notes that current listing practices prioritize short-term profits over sustained market health and calls for strict listing criteria to prevent manipulation in meme coin trading.
Leonidas argues that Binance’s focus on low-cap meme coins has resulted in a large portion of these coins being controlled by insider traders, which not only raises potential conflicts of interest but also questions the credibility of the exchange’s listing policies.
Binance’s Legal Challenges
In addition to the controversy surrounding Binance’s meme coin listings, the company is also currently facing a series of legal issues. FTX has filed a $1.8 billion restitution lawsuit against Binance and its CEO Changpeng Zhao over allegations of fund transfers made under a July 2021 share buyback agreement.
Binance is also embroiled in a legal dispute with the SEC over alleged violations of US securities laws. The increased regulatory scrutiny in the cryptocurrency industry has placed Binance under increased scrutiny, and the company continues to fight the SEC’s allegations by filing objections.
As a result, Binance’s recent meme coin listings have raised serious concerns about market manipulation and insider trading, while the exchange’s legal troubles with regulators have also drawn attention. The growing skepticism and ethical concerns in the market have investors expecting more transparency and openness regarding Binance’s decisions in the future.
