Bitget Exchange "TokenFi Controversy"
Recently, Bitget Exchange's TokenFi (TOKEN) token listing incident has caused a stir. The exchange also issued an announcement on the afternoon of October 31, citing "violent currency price fluctuations and the project party's malicious compression of liquidity to manipulate market prices." Announced the repurchase of TOKEN from users at the highest closing price of the token on the exchange and delisting the trading pair. Although this is not good news for some TOKEN holders who expect to earn price differences, it at least largely guarantees that TOKEN holders on Bitget will not end up losing money.
The following is the official announcement from Bitget Exchange:
After TokenFi (TOKEN) token trading began, Bitget observed violent currency price fluctuations. The project party only stored tokens worth less than US$2,000 in the DEX liquidity pool opened that night, suspected of manipulating the market by maliciously compressing liquidity. price.
In addition, during further review of the project, Bitget also found that there were problems such as the token economy being opaque and the release cycle not being disclosed. In line with a responsible attitude towards users and after comprehensive evaluation and consideration, Bitget has decided to delist TokenFi (TOKEN) tokens and launch a buyback plan for users who hold the tokens on Bitget. The specific arrangements are as follows:
Bitget has suspended the deposit and trading services of TokenFi (TOKEN) tokens at 16:00 on October 31, 2023 (UTC+8), and canceled all pending orders;
Bitget will calculate the highest closing price of the TokenFi (TOKEN) token within the 5 days that Bitget is open for trading (from October 27 to October 31) before 16:00 on November 7, 2023 (UTC+8), that is, 1 TOKEN = 0.00605002 USDT, buy back
To simplify user operations, Bitget will uniformly exchange TOKEN tokens in user accounts into USDT at the repurchase price before the agreed time.
Official announcement link
FLOKI officially reveals the whole story
However, FLOKI officials do not seem to agree with the statement that Bitget Exchange pushed the problem to the project side. Yesterday, they published a long article on the social platform to counterattack and reveal the whole story of the incident in FLOKI official eyes.
SETTING THE RECORDS STRAIGHT ABOUT THE UNAUTHORIZED BITGET $TOKEN LISTING
On October 18, 2023, we put up a DAO proposal to launch the Floki staking program and a reward token that will target a trillion-dollar industry with strong potential. While we didn’t mention it in the DAO… pic.twitter.com/JGnlKmR0lo
— FLOKI (@RealFlokiInu) October 31, 2023
Bitget exchange forcibly lists TOKEN and short-sells TOKEN
FLOKI pointed out in the article that before issuing the token, the official actually required each cooperative exchange to wait seven days after the token is issued before listing it. However, after learning the news, Bitget (FLOKI emphasized that Bitget was the smallest exchange he contacted) secretly listed the token behind the back of the team because they were optimistic about the token’s speculation space.
In addition, FLOKI further pointed out that Bitget listed the currency 12 minutes earlier than the token was opened for circulation. To put it simply, FLOKI accuses Bitget of “being the first to list tokens at what they think is a high price, and then repurchase them from the market at a lower price after the tokens are circulated.” The exchange does not have any TOKEN tokens at all but just Simply short selling.
Market expectations are high, Bitget is struggling to get off the ground
The Bitget exchange initially announced that withdrawals would be open 24 hours after trading began, perhaps anticipating a collapse in token prices during this time and allowing them to cover the tokens in the market. However, as everyone knows, the price of TOKEN tokens exceeded expectations, and the market price continued to rise. Due to betting in the wrong direction, the exchange lost more than 10 million US dollars. As a result, Bitget was forced to refuse to open withdrawals in an attempt to buy time.
OTC negotiations between the two parties break down
Seeing that the problem was getting worse, FLOKI officials "actively" contacted the Bitget exchange to help them solve the problem. The exchange also admitted to FLOKI that they needed up to 1 billion TOKEN to satisfy users' withdrawal requests and fill the loopholes. However, this amount represents nearly 10% of the supply and is worth approximately $20 million at the time of writing, well beyond the planned initial circulation.
At the request of the community and Bitget, the two parties started negotiations for an over-the-counter transaction. However, Bitget proposed to acquire tokens from the TokenFi vault at a discount of 10% of the market price, which was difficult for FLOKI officials to accept. It wrote in the announcement:
"We found this interesting because the problem was entirely due to their irresponsibility."
False accusations and exchange concerns
In response to Bitget's preemptive announcement to delist TOKEN and attack FLOKI's official accusation of "squeezing market liquidity and manipulating market prices," FLOKI officially countered that this statement is inconsistent with the facts. At the time of writing this article, the liquidity in the liquidity pool exceeded 2 million US dollars.
And there is indeed no sign in the Uniswap data that the official has withdrawn a large number of pools midway to manipulate the market price.
Finally, FLOKI officials also expressed doubts about the solvency and sustainability of Bitget trading:
“If an exchange of this size can collect over $10 million from users interested in buying their listed tokens, but not purchase enough actual tokens on the blockchain to at least cover user positions on their exchange, that’s It reflects unprofessional behavior and overall inadequate risk management on the platform. Given what we saw at FTX late last year, it is difficult to imagine that there are still exchanges exhibiting such behavior.”
The exchange and project parties each hold their own opinions, and it is up to each user to judge the truth.
This article FLOKI officially accuses the exchange Bitget of manipulating "TOKEN air currency": malicious short selling first appeared on Chain News ABMedia.
