Binance Suspends an Employee Accused of Front-Running a Token Launch Using Confidential Information

The Binance Wallet team said Tuesday in a post on X that it has suspended a staff member accused of using confidential information

Binance's (BTC/USD) Wallet team has suspended a staff member for allegedly engaging in insider trading by using confidential information from their previous roles at BNB Chain to front-run a token launch, the company said Tuesday on X.

The employee is being accused of exploiting knowledge of an upcoming TGE to purchase tokens in advance.

"This behavior constitutes front-running based on non-public information obtained from his previous role and is a clear breach of company policy," a statement from the Wallet team reads.

Binance's investigation found no evidence that the Wallet team employees were involved in insider trading. The company said the information they used was based on data obtained while they were at BNB Chain, not on the Wallet team.

"We have zero tolerance for such actions and will take the necessary steps to ensure the integrity of our platform and the interests of our users are protected," the statement continues.

Binance said it will cooperate with relevant authorities to pursue appropriate legal action.

The crypto exchange's suspension of this Wallet employee follows Coinbase's (NASDAQ:COIN) 2023 scandal involving former manager Ishan Wahi, who admitted leaking token-listing details with his brother and another contact.

Coinbase eventually got involved in the case to contest the Securities and Exchange Commission's charges that the tokens Wahi inside-traded on were securities.