Two major cryptocurrency exchanges, Binance and Bitget, have launched investigations into trading activity surrounding RaveDAO’s RAVE token after on-chain sleuth ZachXBT claimed that insiders orchestrated a massive short squeeze that fueled a rapid rise in RaveDAO’s RAVE token.
Gracy Chen, CEO of cryptocurrency exchange Bitget, said the exchange had “begun investigating” the matter, while Binance CEO Richard Teng later publicly stated that the platform was also investigating the allegations and would “always” do its part to check for signs of market misconduct. Another exchange, Gate, was also mentioned in ZachXBT’s investigation.
ZachXBT is also personally offering a $10,000 reward to whistleblowers who privately share evidence from all parties involved.
The little-known project rallied earlier this week, resulting in RAVE positions exceeding $44 million, most of which were bearish and liquidated within a day. These liquidations come after a 4,500% rise in one week.
Nonetheless, the short squeeze highlights the RAVE token’s concentration among a small group of wallets. In fact, at the time, nearly 90% of its supply existed in just three Gnosis Safe wallets.
Investigators also flagged token transfers to exchanges shortly before the rally began. Millions of coins were transferred to exchanges before the price started to surge.
RaveDAO is a Web3 project focused on electronic music events, providing blockchain-based ticketing and community governance. Its origins can be traced back to an after-party in Istanbul in 2023, and has since hosted events in multiple regions. The project is expected to generate approximately $3 million in revenue in 2025.
This footprint is in stark contrast to the token’s market behavior. Prior to its surge in April, RAVE had traded below $0.50 for much of its history. It jumped from about $0.30 to over $6 in one day, then climbed to over $27 before starting to fall back.
At its peak, the coin’s market capitalization briefly exceeded $6 billion, making it one of the largest cryptocurrencies by market capitalization before falling. The coin is currently down more than 50% from its peak and has fallen 30% in the past 24 hours.
“Bait and Clear”
Central to another claim is what some have described as a “bait and reckoning” model. The idea is that visible shifts indicate selling pressure, attracting traders to open short positions.
If these tokens are later withdrawn when the price rises, the short seller may be forced to buy them back at a higher price, driving further profits for the other side of the trade. These claims have not been confirmed, but the concentration of supply suggests it is a real possibility.
Community reports have also linked the project to figures associated with early crypto ventures, including ARPA and Bella Protocol, although these connections have not been independently verified. None of the individuals named in the reports have responded publicly.
RaveDAO addressed the situation in a social media post, stating that the team had “no involvement in, and is not responsible for, recent price movements.”
In the post, RaveDAO did not address specific on-chain allegations, including supply concentration or the millions of dollars transferred to exchanges before the pump, but confirmed that it does plan to liquidate some of the unlocked tokens “in due course.”
RaveDAO said it is “exploring appropriate models, including price-triggered or performance-triggered locking, to tie team incentives to ecosystem growth.” It did not commit to any specific mechanism or timeline.
CoinDesk has reached out to RaveDAO for comment.
