Movement Labs has suspended co-founder Rushi Manche after a string of challenges related to alleged market manipulation impacted the project.
The company confirmed the suspension in a statement and cited “ongoing events” and a third-party review by Groom Lake related to organizational governance and relationship with a market maker.
MOVE dump controversy resulted in Coinbase delisting
The origin of Movement Labs’ latest challenges can be traced back to December. This was when a market maker allegedly sold 66 million MOVE tokens and took home an estimated $38 million in USDT profit. The issue was found out in March when Binance detected unusual activity, froze the funds in question and reported the issue to the Movement Foundation and to Movement Labs.
We confirm that Rushi Manche has been suspended from Movement Labs. This decision was made in light of ongoing events and as the third-party review is still being conducted by Groom Lake regarding organizational governance and recent incidents involving a market maker.
— Movement (@movementlabsxyz) May 2, 2025
New information is emerging that the market maker party Rentech was inaccurately reported to be connected to Web3Port. Research indicates that Rentech could very well be a standalone shell company with no online presence. Leaked agreements reveal that Rentech held more than 5% of MOVE’s total token supply, and the agreement terms seemed to trend towards pushing the price up to a $5 billion value before the planned sell-off.
Coinbase resolved to delist the token after it initiated limited trading for MOVE. The exchange announced that the token failed to meet its listing requirements.
The MOVE token has also suffered from the incident impacting the cryptocurrency market, with a 20% loss in the last 24 hours and a 50% loss in the last 30 days. The downward trend represents a long-term erosion of investor confidence as a result of the scandal.
To limit the damage, the Movement Foundation announced that it had terminated its relationship with the implicated market maker. It also stated that it would initiate a USDT buyback for 38 million from a new reserve.
However, the residual effects of the market maker scandal are evident in Manche’s suspension and Coinbase‘s delisting.
Independent investigation to assess the level of internal involvement
Movement Labs has retained Groom Lake to conduct a review of Movement’s governance in relation to the market maker incidents. Their independent investigation is meant to ascertain whether Movement executives were directly involved in the alleged market manipulation scheme or if they were also misled by external parties.
The results of this investigation will be crucial for the project’s future, as they will clarify the extent of any internal knowledge or participation in the token dump that occurred in December. The review comes at a critical time as the project faces both regulatory scrutiny and declining market confidence.
The relationship between Movement Labs, the Movement Foundation, and Rentech remains under particular focus. The leaked contracts suggesting Rentech controlled a substantial portion of the token supply raise questions about due diligence and oversight within the project’s management structure.
Rushi Manche’s suspension as co-founder appears to be a precautionary measure while the investigation proceeds, though the company has not specified whether he is suspected of direct involvement or oversight failures. The temporary removal of a founding team member signals the seriousness with which the organization is approaching the allegations.
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