Binance introduces a $5 million reward program in response to the recent controversy surrounding the listing of $RON.

Goran Radanovic

Trading
Binance

The reward initiative provides compensation ranging from $10,000 to $5 million for verified information that uncovers corruption associated with token listings and related domains.

Binance is initiating a bounty program that provides an opportunity to earn up to $5 million in rewards for verified information that can help uncover corruption within its staff. The exchange’s decision to implement this program comes as a response to allegations of insider trading, particularly concerning its procedures for introducing new tokens.

On February 5th, Binance listed the Ronin token (RON), which had seen a significant surge of over 30% in the week leading up to the listing announcement. However, shortly after its listing on Binance, RON’s value dropped by approximately 18% within just one hour, ultimately experiencing a 26% decline by the end of the day.

Binance

The swift price fluctuations sparked suspicions of leaks that may have allowed traders to gain an unfair advantage ahead of the listing. Binance co-founder Yi He revealed that the exchange had identified instances where certain users came across blockchain data indicating Binance’s preparations to list the token.

Despite the ensuing controversy, Binance is committed to revamping its current listing process in order to rebuild trust. These reforms encompass tighter internal communication controls and a more rigorous monitoring process for team members involved in listings. Employees caught leaking information regarding upcoming token listings will receive a warning for their first offense, and repeat offenders will face termination.

The reward program ranges from $10,000 to $5 million for verified tips that unveil corruption linked to token listings and related domains. Projects found hiring terminated Binance employees will be permanently blacklisted, and Binance is implementing stricter external communication protocols regarding listings, with premature information leaks leading to listing cancellations.

While emphasizing the encrypted nature of its listing announcements, Binance recognizes the possibility of leaks that could trigger automated trading based on listing news. Enhanced technical monitoring efforts are being implemented to address this concern.

This controversy follows accusations in January 2023 of potential trading bots exploiting leaks to profit from token listings on Binance. Coinbase director Conor Grogan pointed out several wallets exhibiting a pattern of purchasing tokens just prior to listing announcements and then selling them once the tokens are listed.