Token Dumping Scandal Sparks Internal Turmoil at Movement Labs
Movement Labs, the blockchain firm behind the MOVE token, is conducting an internal investigation into a controversial market-making agreement that granted a shadowy intermediary control over 66 million MOVE tokens. The aftermath of the deal triggered a $38 million token selloff and raised serious concerns about price manipulation and insider involvement.
Controversial Market Deal
The incident centers around a contract involving Rentech, a little-known entity that reportedly appeared on both sides of the agreement — once representing the Movement Foundation and once posing as a subsidiary of market-making firm Web3Port. The deal allowed Rentech access to a substantial share of MOVE’s circulating supply shortly after its December 9 market debut.
Initial internal assessments labeled the deal as potentially disastrous. One official described it as “possibly the worst agreement” they had ever seen. The terms included profit-sharing provisions based on inflated token valuations, which experts say created incentives for artificial price inflation followed by a dump onto retail investors.
Binance Ban and Token Fallout
The fallout was swift. Wallets linked to Web3Port liquidated tens of millions in tokens immediately after launch. In response, Binance banned the involved market-making accounts for misconduct. Movement Labs has since launched a token buyback program and initiated a third-party investigation.
Leadership Scrutiny
The controversy has fueled tension within Movement’s leadership. Internal communications suggest that Movement Labs co-founder Rushi Manche promoted the Rentech arrangement, while legal counsel YK Pek and other foundation directors initially rejected the deal due to its risky terms. However, a revised version of the agreement was ultimately approved, removing some, but not all, of the problematic provisions.
Movement’s other co-founder, Cooper Scanlon, described the project as a “victim” in this arrangement and has committed to uncovering how the agreement was finalized despite red flags.
Allegations of Shadow Influence
Attention has also turned to Sam Thapaliya, a crypto entrepreneur and associate of Manche. Although not formally part of Movement’s leadership, Thapaliya is believed to have played an outsized advisory role and was reportedly involved in conversations regarding the token’s market launch and airdrop strategy.
Some insiders have referred to Thapaliya as a “shadow co-founder” due to his frequent involvement in high-level decisions. He denies having any ownership stake, token allocations, or executive authority within Movement.
Questions Over Rentech’s Origins
Galen Law-Kun, founder of Rentech and a known associate of Thapaliya, claims the firm was established to link crypto projects with Asian investors. Law-Kun has insisted that legal structures and contracts involving Rentech were set up in collaboration with Movement’s legal team — a claim strongly denied by legal counsel YK Pek, who stated he had minimal interaction with Law-Kun and provided only administrative services to unrelated companies.
Further scrutiny has revealed that Web3Port had previously signed a deal with Rentech representing “Movement” weeks before the official agreement with the Movement Foundation was finalized — a revelation that raises the possibility that parallel arrangements were in motion without the foundation’s full awareness.
Ongoing Review
Movement Labs has retained Groom Lake, an independent auditing firm, to conduct a comprehensive review of the matter. According to internal messages, the investigation aims to clarify the roles of all parties involved and ensure accountability for what many insiders see as a severe lapse in judgment.
