Straight Dope on Movement Labs Turmoil
Co-founder of Movement Labs under suspension due to controversial market maker scandal
Here's the Scoop:Movement Labs, a buzzing Ethereum layer-2 startup, is in hot waters. In a shocking twist on May 2, 2025, the company announced the suspension of co-founder Rushi Manche, embroiled in a messy market-making scandal.
Details surfaced of Manche's alleged involvement in the dumping of 66 million MOVE tokens (worth approximately $38 million) shortly after the token's launch in December 2024. The plot thickens as Rentech, a seemingly shady company, was believed to be the culprit.
But here's the kicker: Rentech claimed to be a subsidiary of Web3Port, with no verifiable online existence to back up the claim4. Furthermore, Rentech controlled 5% of MOVE’s supply, aiming to artificially inflate the token’s value to a breathtaking $5 billion for coordinated sell-offs, reaping shared profits4.
The Downfall:MOVE took a nosedive following this revelation, plummeting 86% from its highs, hitting $0.1960 post-announcement2. The controversy led to MOVE's trading being suspended on Coinbase, effective May 15, 2025, just hours after Manche’s suspension4.
The Investigation:Groom Lake is currently conducting a thorough audit of Movement Labs’ governance and the market-making incident. Meanwhile, Binance froze proceeds from the token dump in March 2025 following the detection of irregularities4.
Inside Movement Labs' Telegram group, moderator Merq confirmed Manche's suspension and appealed for patience, emphasizing the importance of awaiting the results from the audit.
Rushi Manche has yet to comment on these allegations.
By Sebastian Sinclair
Daily Debrief Newsletter
Enrichment Data:
- Rentech, a dubious company, posed as a trading firm named Web3Port's affiliate and dumped 66 million MOVE tokens, sparking tension within the organization.
- Rushi Manche is alleged to have forwarded the Rentech deal, despite legal concerns and conflict warnings, and remained involved in both Movement Labs and the nonprofit Foundation, despite their intended separation.
- The Foundation thought it was contracting Web3Port to offer liquidity for MOVE's launch, but internal documents revealed that Rentech appeared on both sides of the agreement, once as Web3Port's representative, and again as an agent acting on behalf of the Foundation itself.
- Amid the movement Labs turmoil, Rushi Manche's involvement in the dumping of 66 million MOVE tokens has raised questions about the ethereum-based startup.
- The allegations against Manche involve the sale of tokens worth approximately $38 million shortly after the token's launch in December 2024, which sparked a dramatic drop in the value of MOVE on crypto exchanges.
- Interestingly, Rentech, the company believed to be responsible for the token dump, claimed to be a subsidiary of Web3Port, but no verifiable online evidence supports this claim.
- Furthermore, Rentech controlled 5% of MOVE’s supply, aiming to artificially inflate the token’s value and coordinate sell-offs, reaping shared profits.
- The fallout from these actions led to MOVE's trading being suspended on major crypto exchanges, including Coinbase, causing a significant financial impact on the technology-focused business.
- As the investigation into the market-making scandal continues, experts are examining the role of Affiliate relationships in similar finance-centric business operations, seeking to minimize future instances of such deceptive practices.
- Meanwhile, the CEO of Movement Labs Labs, Rushi Manche, has yet to publicly address the allegations against him, leaving the crypto and technology community in a state of anticipation as the situation unfolds.
