FBI’s NexFundAI helped the agency nab market manipulators in crypto.
Kaiko reported a symmetry in buying and selling volume of the token.
The scammers engaged in wash trading and investors remained unaware.
An FBI sting operation called Operation Token Mirrors used a fake crypto project, NexFundAI, to expose wash trading by three market makers: ZM Quant, CLS Global, and MyTrade. Blockchain research firm Kaiko analyzed on-chain data, confirming the FBI’s findings and revealing the extent of the manipulation.
The FBI created NexFundAI in May 2024 and had listed it on Uniswap, where the market makers used bots and hundreds of wallets to create the illusion of trading activity. Kaiko found that buying and selling volumes were symmetrical, indicating that the firms were simply offsetting trades to artificially inflate volume.
Kaiko said it analyzed the on-chain data for the NexFundAI cryptocurrency and found wash trading patterns that these firms and individuals created. The blockchain analysis entity said its findings “reinforce information uncovered by the FBI through its undercover ‘sting’ operation.”
The NexFundAI cryptocurrency was only avail…
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