One of the most anticipated Layer 2 projects in recent times – Movement – is caught in a storm less than half a year after its launch. Recent revelations have unveiled a serious financial scandal related to the MOVE token, with allegations of price manipulation, internal leaks, and opaque market contracts leading to a dump of 38 million USD just one day after being listed.
Rentech: The shady "intermediary" manipulating 66 million tokens
According to leaked internal information, #MovementLabs is investigating the possibility that they were tricked into signing a market-making contract with an entity named Rentech — a name that has almost no trace online. This contract granted control over 66 million MOVE tokens (equivalent to over 5% of the total supply) to Rentech, and it was this contract that triggered the sell-off causing the MOVE price to plummet after the first listing on December 9.
Notably, Rentech appears in the contract in both roles: as a representative of Web3Port — the market-making entity — and as a "representative" of the Movement Foundation. The fact that one party signs a contract representing both sides is a clear sign of self-dealing behavior and severe conflicts of interest.
An internal memo from the Movement Foundation called this "one of the worst contracts ever seen," while many external experts warned that this contract created a clear incentive to push the MOVE price to an abnormally high valuation (over 5 billion USD FDV) and then dump it all onto retail investors to share the profits.
38 million USD "evaporated" after 24 hours and a ban from Binance
Just one day after the token $MOVE was listed on exchanges, wallets associated with Web3Port dumped 66 million MOVE tokens — worth 38 million USD — causing a severe shock to the market. After the incident, Binance banned this market-making account citing "misconduct."
To salvage the situation, Movement announced a token buyback plan while denying that the project has any direct connection to this behavior. However, the contract allowing the tokens to be dumped immediately, without adhering to the customary lock-up period in crypto projects, raises many questions among investors about the transparency of the management team.
Internal conflicts and a crisis of trust
The scandal not only caused the MOVE token to plummet but also exposed deep divisions within Movement. Founders, legal advisors, and external advisors were all brought under suspicion. Some insiders had warned beforehand about the unusual nature of the contract with Rentech, but it is unclear why the contract was still approved.
On the internal Slack on April 21, co-founder Cooper Scanlon stated that the team is investigating why an entity like Rentech — which is believed to be a subsidiary of Web3Port — was granted control over a large amount of tokens, while it seems that this is not the case. Rentech denies any wrongdoing.
Market manipulation under the guise of "market maker"
In the crypto world, market makers play a role in providing liquidity and stabilizing prices. However, this position is also easily abused to manipulate the market and siphon money from retail investors quietly.
According to an industry veteran — Zaki Manian — the terms in the MOVE contract are not only controversial but also "insane enough that just discussing them is alarming." He pointed out that the parties designed the contract with a clear goal of inflating the token's price to sell for profit.
The project was once backed by World Liberty Financial
Movement was once considered one of the promising Layer 2 solutions due to the Move technology (a programming language originally developed by Facebook) and was backed by World Liberty Financial — a crypto alliance supported by former President Donald Trump.
However, after this scandal, the project's reputation is severely threatened. Binance has taken decisive action, the community has lost trust, and the leadership team is suspected of lacking risk management capability and professional ethics.
Impact on the crypto market and Binance users
The MOVE token incident serves as a wake-up call for investors on Binance and the entire crypto market regarding the risks of participating in new projects that have not been thoroughly vetted. Although MOVE is not yet a popular asset on Binance, the price crash due to internal manipulation could negatively impact overall trust in new Layer 2 solutions.
Binance, with its increasingly strict policies against opaque market-making activities, will have more reasons to tighten partner checks and the mechanisms for listing new tokens. Users on the exchange also need to be highly vigilant with unusually rapid price increases of tokens, as there may be an entire "dump scenario" staged behind the scenes.
Conclusion
The Movement scandal is a classic example demonstrating how the crypto market is still very vulnerable to opaque behaviors, especially when regulations are unclear and trust is misplaced. Although MOVE may technically recover in the future, the stain from the Rentech contract will haunt the project for a long time.
Risk warning: Investing in cryptocurrency carries significant risks and may not be suitable for everyone. Asset prices can be highly volatile and may lose all value. Please research thoroughly and only invest money you can afford to lose.
