Source: The Block

Binance Wallet announced it has suspended an employee for allegedly using insider information to sell tokens for substantial profits before the project's token generation event (TGE).

Binance stated that the employee used information obtained in his business development (BD) role within BNB Chain.

The cryptocurrency exchange Binance has suspended an employee for allegedly using insider information about a certain crypto project to gain unfair profits.

According to a post on X on Tuesday, an employee from the Binance wallet team purchased a large amount of tokens of a project that he knew was about to hold a token generation event and sold some of the tokens held to gain considerable profits.

The employee utilized privileged information obtained from his previous role in business development within BNB Chain, Binance clarified that the wallet team itself does not have access to private information related to the project.

Binance stated: 'This behavior constitutes front-running based on non-public information obtained from its former role, which clearly violates company policy.' Therefore, the employee was immediately suspended and is awaiting further disciplinary action.

While Binance did not disclose the name of the crypto project, multiple users on X pointed out that the related project is the memecoin UUU (U DEX Platform) token on the Binance Smart Chain.

X user 'pycharts' posted a screenshot that appears to show a wallet address selling over 6 million UUU tokens around 7 AM on March 23, leading to a significant collapse in the token's price. The user's screenshot links the wallet address to Binance wallet's BD and growth team member Freddie Ng.

In response to a post by pychart on X, Binance's official Chinese account stated that it has noted the 'feedback' and has initiated an internal investigation, the results of which will be announced to the public in due course.

At the same time, the global exchange stated that it will 'actively cooperate' with relevant authorities in the jurisdiction where the employee is located and take legal action in accordance with applicable laws.

Binance also announced that it would reward $100,000 to four whistleblowers who reported the allegedly unethical behavior through official reporting channels.