US DOJ Sue 4 Companies for Alleged Manipulation of Meme Coin Market

Bittime - US Department of Justice (DOJ) has just filed charges against several crypto market maker companies for alleged manipulation of the meme coin market, namely Gotbit, ZM Quant, CLS Global, and MyTrade.

This meme coin market manipulation involves wash trading to attract investors into the scheme pump and dump. Read this article to find out more!

Manipulation of Meme Coin Market Using Fake Token

The DOJ accused the four companies above of manipulating the meme coin market using techniques of wash trading, i.e. trading digital tokens between the same entities to create fake trading volumes. 

To investigate this case, the FBI even created a fake digital token called NexFundAI to expose this illegal practice. 

As a result, the FBI succeeded in uncovering the involvement of the four companies above in manipulating the meme coin market and confiscated over $25 million in crypto assets.

Read Also: ZachXBT Accuses Ansem of Manipulating the Meme Coin Market 

Market Maker Manipulating the Meme Coin Market

Gotbit, the one claim as market maker for meme coin, is one of the main focuses in this case of meme coin market manipulation. 

Gotbit offers on-demand market manipulation services, namely creating fake trading volumes to make tokens appear more attractive to new investors. 

Gotbit CEO Aleksei Andriunin, as well as two other directors, were charged for their involvement in the scheme. Andriunin admitted that he had falsified trading volume as well as creating the illusion of an active market, especially for meme coins.

Manipulation of Meme Coin Market with Pump and Dump Scheme

Meanwhile, pump and dump schemes are nothing new in the crypto world. In this scheme, the perpetrator buys a large number of tokens at a low price, then manipulates the price by artificially increasing the trading volume so that the token price soars. 

Once the price reaches its peak, perpetrators sell their tokens for huge profits, while other investors attracted by the ever-rising price end up stuck with an asset whose value drops drastically.

Meme coins are popular targets for these schemes as they tend to attract a lot of attention with prices that can spike suddenly, even without a strong fundamental basis. 

Saitama: One of Meme Coin Market Manipulation Case

One of the cases of meme coin market manipulation uncovered by the DOJ was the Saitama crypto company. This meme coin project managed to reach a market capitalization of $7.5 billion. 

However, the actors behind the project are actively manipulating the market. The perpetrators secretly sold their tokens and made profits of up to tens of millions of dollars, while other investors suffered huge losses.

Read Also: Meme Coin MOODENG Becomes Top Rank in Last 7 Days! 

How to Buy Crypto with Bittime

Want to trade, sell and buy Bitcoins and crypto investment easily? Bittime is here to help! As an Indonesian crypto exchange officially registered with Bappebti, Bittime ensures every transaction is safe and fast.

Start with registration and identity verification, then make a minimum deposit of IDR 10,000. After that, you can immediately buy your favorite digital assets!

Check the exchange rate BTC to IDR, ETH to IDR, SOL to IDR and other crypto assets to find out today's crypto market trends in real-time on Bittime.