Recently, the Federal Bureau of Investigation (FBI) of the United States, the Securities and Exchange Commission (SEC) and other regulatory agencies jointly launched a major operation against the cryptocurrency market. Through the means of "fishing enforcement", they successfully lured several market makers suspected of market manipulation and fraud. This operation has attracted widespread attention, not only revealing illegal activities in the cryptocurrency industry, but also marking the regulators' tough attitude towards the crypto market.

In this operation, the FBI established a fake cryptocurrency project called NexFundAI, which is actually a so-called "junk coin" (a fake cryptocurrency with no real value or project support), and used it as bait to contact multiple market makers. The FBI's goal is to further uncover illegal activities such as market manipulation, fraud and money laundering by monitoring the trading behavior of these market makers.

In simple terms, the FBI's "phishing" tactics include monitoring and recording communications with these market makers, and found that they discussed how to manipulate the price of NexFundAI tokens in Telegram and video conferences. This clever law enforcement method not only reveals the illegal activities of market makers, but also provides important evidence for subsequent legal proceedings.

It is reported that several market makers involved in the fake project were caught in the act, including Gotbit Consulting, ZM Quant Investment, CLS Global, My Trade and Saitama. The US prosecutors have filed formal charges against the executives and employees of these market makers, including market manipulation, fraud, money laundering, etc. Federal prosecutors said that the arrested market maker employees may face decades of imprisonment and huge fines.

Court documents show that the accused company manipulated cryptocurrency prices by controlling accounts to conduct fake transactions, creating the illusion of active trading and attracting investors. The specific methods used by market makers include brushing, arbitrage, and false buy and sell orders. By forging market transaction depth and volume, they mislead investors and raise the market price of fake projects.

Among them, Saitama once reached a peak of billions of dollars in the market, and its leadership manipulated the market by issuing false statements and secretly selling tokens, making tens of millions of dollars in profits. Gotbit's founder Alexey Andryunin publicly talked about how he artificially raised trading volume through wash sales in 2019. In an interview, he said that Gotbit's business was not registered in any jurisdiction and admitted that its behavior was not entirely ethical.

In addition, through this enforcement action, the U.S. Department of Justice has seized more than $25 million in cryptocurrency assets, involving about 60 different cryptocurrencies. The seizure of these assets shows the regulator's zero tolerance for market manipulation. U.S. Acting Attorney Joshua Levy said that wash trading has long been banned in the financial market, and the crypto industry is no exception. He emphasized that these cases are the result of a combination of innovative technology and traditional fraudulent tactics, showing the importance of market supervision.

The background of this action stems from the continued concern about illegal activities in the crypto market. Although the cryptocurrency industry is regarded as a representative of innovative technology, many projects and companies in it have serious fraud and manipulation. The FBI's investigation focuses on some market makers who use fake transactions to artificially raise token prices and make huge profits. These market makers play an important role as liquidity providers in the industry, but their actions have seriously disrupted the normal operation of the market.

The market manipulation by market makers not only violates the securities and commodity laws of the United States, but also undermines the trust foundation of the entire cryptocurrency market. As more and more traditional investors and institutions enter the cryptocurrency market, the transparency and fairness of the market have received widespread attention. This action reveals that even in a decentralized and highly transparent market, there is still a lot of manipulation, especially market makers can use their market position and technical advantages to intervene in the market. After this incident, the industry will definitely strengthen the supervision of market makers and require them to comply with stricter trading rules to maintain the normal operation of the market.

It is worth noting that this sting operation has had a far-reaching impact on the cryptocurrency market. On the one hand, the exposure of market manipulation and fraud may undermine investor confidence in the short term and cause some funds to flow out of the market; on the other hand, it will also prompt market participants to pay more attention to compliance, help eliminate the industry's "scam" stigma, and promote the entire cryptocurrency to develop in a more transparent and healthy direction.

In addition, this incident is also an important warning to ordinary investors. Although the cryptocurrency market is full of opportunities, it also hides a lot of risks. Investors must be vigilant when trading, especially for cryptocurrency projects with unknown origins and exaggerated publicity.