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Kain Warwick, the co-founder of the decentralized derivatives platform Synthetix, has shed light on what he describes as the deceptive tactics employed by market makers (MMs) to manipulate cryptocurrency prices. In a detailed post on X, Warwick explained the evolution of these entities, from their initial role in facilitating exchange listings to orchestrating intricate price schemes that often leave retail investors holding devalued assets as exit liquidity. During the initial coin offering (ICO) boom, Warwick noted that projects were typically required to pay market makers substantial fees, ranging from $50,000 to $300,000 per month, to secure listings on cryptocurrency exchanges and attract significant investors. He pointed out that without these often costly deals, it was nearly impossible for emerging projects to secure the necessary capital and exchange listings. However, Warwick highlighted that as early as 2017, some market makers began to shift their focus towards more manipulative tactics. Instead of prioritizing genuine liquidity provision, these MMs allegedly started artificially inflating trading volumes on smaller, lesser-known exchanges while strategically avoiding scrutiny on major platforms like Binance and Kraken. Warwick outlined how market makers began using call option structures to profit from price manipulation. Rather than providing genuine liquidity to the market, these MMs would allegedly engage in tactics to artificially pump up the prices of tokens. Once the price reached a certain level, they would exercise their call options and then quickly dump their holdings onto the market for profit. Related: Senator Warren Questions Trump Administration Over Crypto Policy Conflicts, Market Manipulation Accusations The low float strategy, which involves launching a token with a limited number of coins initially available for trading, and which gained popularity through figures like Sam Bankman-Fried, further amplified the value and effectiveness of these manipulative call option schemes. With fewer tokens in circulation at the time of launch, market makers could exert more control over the price action. They would allegedly sell into market bids to create artificial buying pressure, short the token to further drive down the price, and then buy back their positions at lower prices, ensuring maximum profits from these orchestrated price swings. According to Warwick, projects now sell discounted tokens to liquidity funds before their Token Generation Event (TGE). These funds then agree to strategically bid on the market, creating a false impression of strong demand for the token. Simultaneously, a large portion of tokens is sent to exit-strategy MMs, who then proceed to dump these tokens into the artificially inflated market. Related: Justin Sun Accuses Coin.com of Market Manipulation, Gets Accused Back This cycle enables MMs and early investors to exit with profits while leaving retail buyers holding devalued tokens. Warwick cautioned that large token transfers to market makers should be viewed as a red flag, potentially indicating such manipulative schemes are underway. Warwick criticized these tactics, emphasizing that a legitimate market maker should focus on providing liquidity with tight bid-ask spreads rather than manipulating prices. He urged investors to demand greater transparency from projects engaging with MMs. He also revealed that Synthetix was among the first projects to be exploited by DWF Labs. Warwick stated that DWF Labs purportedly purchased treasury tokens from Synthetix, artificially pumped the price in a low-liquidity environment, and then proceeded to dump their holdings for profit, leaving Synthetix and its community with the consequences. Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.

Trump-Backed Stablecoin Trump-backed World Liberty Financial plans to launch a stablecoin, USD1, backed by U.S. Treasurys on Ethereum and Binance. The project raised $550M from investors, including Justin Sun. Reserves will be managed by BitGo. #Crypto #Stablecoin #Bitcoin #Ethereum #Binance #Trump

Canary Capital’s Frequent ETF Filings: Are Alternative Crypto ETFs Just a Marketing Ploy? The low cost of submitting S-1 documents may be one of the reasons for the recent large number of applications for altcoin ETFs. It only costs $100k. Canary has applied for SUI, Axelar, LTC, AXL, Solana, XRP, etc. The latest application of PENGU ETF has caused controversy. The founder of Canary Capital is Steven McClurg, who is also the co-founder of Valkyrie Funds, and Justin Sun is also an investor in Valkyrie. Read more

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TRON founder Justin Sun has shared his thoughts about potentially reducing TRX block rewards, drawing parallels to Bitcoin’s halving mechanism. In a recent tweet, Sun shared his thoughts on implementing a reward reduction for Tron ( TRX ). He noted that the cryptocurrency is already deflationary, with supply decreasing by 1% annually. This makes TRX “the only deflationary asset among major cryptocurrencies,” according to Sun. “This discussion about TRX’s upcoming reduction in block rewards is worth paying attention to! Will TRX follow Bitcoin’s path and enter a halving cycle?” Sun wrote on X. He also compared the potential change as an evolution similar to Bitcoin’s development. Sun explained that as Bitcoin’s ( BTC ) network matured and its price increased, block rewards were gradually reduced through the halving mechanism. He suggested that TRON could follow a comparable path, noting that the rising TRX price has increased rewards for block-producing nodes across the network. The proposal , formally submitted on GitHub as “Reduce TRX block rewards #738,” outlines several potential scenarios. Reducing 1 million TRX in daily block rewards would increase the deflation rate by 50% to 1.5% per year. At the same time, a 2 million TRX reduction would double the deflation rate to 2% annually, creating an impact “comparable to Bitcoin’s halving.” The GitHub proposal also mentions multiple benefits of implementing such changes. This includes better deflation, increased staking incentives, strengthened network security, and improved economic alignment. “Timely adjustments to TRX block rewards can better promote the healthy and sustainable development of the TRON network and TRON ecosystem,” the proposal states. Unlike Bitcoin’s automated halving mechanism that cuts rewards by 50% approximately every four years, TRX’s proposed reduction would be implemented through community governance. “Ultimately, this decision rests with the TRX community!” Sun emphasized. Sun highlighted that even with reduced block rewards, “the current incentives for network validators remain highly attractive.”