[EN] DWF Labs — fraud schemes, pump-and-dumps and scams
This is Shaman, author of the Crypto Shaman channel.
In recent years, market liquidity has severely sagged, volumes have dropped, and some market makers have left the industry. In addition, one of the largest MMs of these years, Alameda Research, went bankrupt, leaving an indelible stain on the history of the cryptocurrency market.
Against this backdrop, the unusual actions of the remaining Market Makers are increasingly being noticed by the community. And, unfortunately, some of these actions look outright fraudulent.
Digital Wave Finance
Digital Wave Finance (DWF Labs) is a widely known Market Maker (MM) of the market and is managed by Andrey Grachev.
Digital Wave Finance is one of the largest market makers in the cryptocurrency market at the moment.
This article will break down what DWF Labs has been up to in recent years, where it has invested, what it has encountered. Partnerships with DWF Labs are presented as something graal, promising a quick bullrun, a happy future for the project and its coin. Is it so?
Who is Grachev?
Andrey Grachev had studied and lived in Russia for a long time. He worked as an independent trader, trading oil futures. Then he switched to cryptocurrency futures. He was the CEO of Jiamix, an exchange based on OKEX. He is a co-founder of Black Ocean.
He was also the vice-president of RAKIB in 2018. RAKIB is a non-profit organisation closely linked to a state-owned bank called VEB (Vnesheconombank) (in the original — ВЭБ (Внешэкономбанк)), and their main goal is to promote crypto regulations in Russia. In 2019 Grachev became the head of Huobi Russia. His partner in RAKIB was Vladimir Demin, who also headed Huobi Russia after Grachev. Demin was also a senior manager at VEB Ventures, the venture capital fund of a large Russian state-owned bank.
With his past trading experience and having partnered with a Swiss high-frequency trading company, Grachev quickly increased (link — in russian version) Huobi’s trading volume by tens of millions of dollars. Since then, DWF Labs has been running pump-and-dump schemes and pumping up volume for tens and hundreds of Shitcoins.
Increasing volume on Huobi was done through high-frequency trading, or in simple words, wash-trading. The purpose of wash-trading is simple — to persuade a retail trader that there is supposedly an interest of a major player (whale) in a particular cryptocurrency. Such manipulations are strictly punished in many countries if you do them in the stock market. But this is a cryptocurrency market, where many laws are absent. That gives various fraudsters a wide range of actions.
Under management
CoinGecko (link — in russian version) provides an incomplete list of tokens where DWF Labs acts as MM. Some tokens can be found on Coinmarketcap. These are mostly shitcoins that nobody knows about. Their trading volume ranges from $30,000 to $300 million per day.
The charts of many tokens are “impressive” — most of them are unnatural, it is obvious that it is a manipulated ragpool. Some tokens have fallen to the eternal bottom, some are in strong volatility. But most importantly, they do not give the impression of “organic trading”. Some coins show frankly inflated volumes for certain periods of time on various exchanges.
A list of tokens from CoinGecko in the portfolio is provided below:
Reputation
April 2019, community accuses (link — in russian version) DWF of ‘massive fraud’.
DWF Labs was the third largest market maker on FTX in the two months before the exchange collapsed.
Grachev believes (link — in russian version) that every blockchain should have memtokens. I have described (link — in russian version) the actual threat memtokens pose to the industry in a separate study.
In April 2023 DWF Labs was accused (link — in russian version) by the community of $65 million in “ questionable transactions” and hidden ties to the OneCoin ponzi pyramid scheme. Grachev hinted at OneCoin’s listing on Huobi when he was still in a senior position at the exchange’s Russian office.
In the summer of 2023 DWF Labs was again criticised by the community for its secondary market activity in YGG, DODO, C98, CYBER and other tokens. Grachev pointed to the market itself as the reason for the strange volatility of these tokens, noting that DWF Labs does not even dare to think about market manipulation.
A reserch (link — in russian version) was published in November 2023, which I was able to find. The details of the FLY token mutations, which is what DWF Labs is doing now.
Grachev keeps almost all of the firm’s funds on CEX exchanges, “for security”. And this is despite the multiple and constant hacks of exchanges, such as the recent hacks of Huobi and Poloniex (link — in russian version).
In his youth, Grachev ran a company called VRM Research, with a token called FLY. This is the token DWF Labs issued for Black Ocean. Black Ocean is a pull that allows huge liquidity to be injected into new projects in an attempt to pummel their prices. The goal was to create a mechanism to quickly attract investors and speculators to a project through the token’s price performance and unprecedented liquidity. As a result, the token turned out to be a complete scam, merged by 99.76%. It looks even worse than the chart of FTT after the FTX scam.
Grachev writes that he uses a “market-neutral aggressive strategy against orderbooks”. So neutral or aggressive? Is it possible to be “neutral” and “aggressive” at the same time?
In April 2023 CoinDesk writes that DWF Labs is privately offering crypto companies to buy tokens “at a discount from the market price.”
Christian Gil of trading firm GSR has an opinion on Grachev: “We at OKX Exchange and Wintermute were disgusted to be on the same stage as DWF Labs. It’s very sad that in 2023 scammers like DWF Labs can still get so much attention.”
What is the problem?
It is assumed that DWF Labs buys a block of tokens of the next project on the over-the-counter (OTC) market or directly from the project. Accelerates the price. Then “announces” the investment. It is assumed that the project boasts support from DWF and this provides PR. Marketing/schilling is performed. At this point, a secret sale of part or all of the tokens of the project is carried out.
As a rule, the moment of investment announcement is the peak of growth. Or it is a near-peak value, after which the token price makes -50–90%.
Actually, it is a pamp-dump scheme with various features. In the examples discussed below, there were situations with a standard price dump attempt, such as in the Tellor Tributes (TRB) example. Sometimes a fraudulent scheme to reissue a smart contract is used in addition, such as GalaGames (GALA) or Conflux (CFX). Sometimes a “hacking” scheme is used, where official project resources are allegedly hacked, e.g. Velo (VELO).
Whitewashing reputation
An interview with Grachev was recorded (paid?) with a positive message. Against the background of a lot of criticism, Andrei is trying to whitewash his reputation. Then, this interview was posted on several major TV channels.
“Sergey (ICO Drops) notes” (in the original — Sergey (ICO Drops) заметки) (41,000 followers)
Beautiful time codes and praising Grachev’s “merits” as a global star.
The interview itself started with “let’s talk about biography” and then “tell me about Huobi Russia, about the competition with Binance”. So, the first question is not about how a person came into the industry in general, about earlier projects and experiences, of which there are also plenty. From the very beginning, Grachev started talking about high-frequency trading (wash-traging). That is, he began to justify himself.
MMarketMaker (45,000 followers)
A repost of the same interview (in russian):
“TT|Top Traders🏆analytics” (28,000 followers)
Another major crypto channel.
“001k.Trade” (95,000 followers)
This channel often likes to quote Grachev. For example, with bitcoin at $37,700, Grachev says that we are only at the very beginning of the bullrun.
I put his forecast on the chart. Well, we should wait and see how accurate the forecast from the “top MM” will be in the perspective of 2024–2025.
”odyssey grimace” (in the original — “одиссея grimace”) (112,000 followers)
Another example of a positive review from the channel running the same scam token GRIMACE (link — in russian version). “Any token where DWF Labs becomes MM-m has the property to make 10 X’s” — a frank lie, which the author of the scam token publishes to a hundred-thousand audience.
МТ ( 21,000 followers)
The author points out that tokens associated with DWF Labs often go up a lot.
These are all great examples of how TG channels create a false positive image about DWF Labs and thereby help it make money from subscribers to these channels, using the audience as an outlet for liquidity.
Partnerships
Partnerships with various companies are further explored, as well as highlighting some of the problems with these companies that have leaked to the public.
The rule of thumb here is “Tell me who your friend is and I’ll tell you who you are. This means that if a company is working with dozens of other companies suspected of fraudulent schemes, the company itself is most likely engaged in fraud. The patterns by which fraudulent pampo-dump schemes are organised are perfectly visible on these projects.
Both noname projects and those that at one time were on everyone’s lips.
- Chrono.tech (TIME)
- LeverFi (LEVER)
- Mbox (MBOX)
- Algorand (ALGO)
- EOS (EOS)
- Conflux (CFX)
- TokenFi (TOKEN)
- GalaGames (GALA)
- Mask Network (MASK)
- Radio Caca (RACA)
- ArbDoge AI (AIDOGE)
- Waves (WAVES)
- Synthetix (SNX)
- Velo (VELO)
- Tellor Tributes (TRB)
- Friends.tech
What is curious — these coins are not in the portfolio of FTX (Alameda). It means that the coins were chosen on the principle of “scam”, but at the same time they were not used by other scammers in the acceleration of the price. Such coins as Solana, BONK, it’s a different story, and it’s not DWF Labs that is involved in the overclocking of these coins.
DWF Labs / chrono.tech (TIME)
On the crono.tech site, a partnership [*wa] (link — in russian version) with DWF Labs:
The partnership is concluded (link — in russian version) on 17 March 2023:
Project fraud facts
ChronoTech is the scandalously famous ponzi-token of the fraudster Sergey Sergienko, known for his participation in Varlamov’s scam. Sergienko lived in Australia, came to the Russian Federation, ran a scam, and left again, after which he changed his name.
A 2018 article [*wa] (link — in russian version) described this story in more detail.
Despite the clear scam of the TIME token, a “time-bound” token whose scams have been known about for several years, DWF Labs continues to trade it.
Price history
The token’s price has folded 50 times c ATH: -97.6% from a peak in 2022.
DWF Labs / LeverFi (LEVER)
On 28 December 2023 DWF Labs officially signs a partnership with LeverFi:
Project fraud facts
LeverFi presents itself as a “ lunchpad platform for BRC20 tokens”, i.e. for NFT jpegs on the bitcoin blockchain, due to which the commission periodically grows. That Ordinals is a toxic technology killing the bitcoin blockchain has been written (link — in russian version) about more than once.
LeverFi / DWF Labs marketing arsenal includes a fake “partnership” with Microsoft. Published the news [*wa] on the official resource. LeverFi had the nerve to call the material:
“LeverFi is working with Microsoft to launch and develop AI decentralised financial solutions”:
This situation was noticed half a year ago, there was a whole discussion thread on Reddit.
On this fake announcement, the token price first rose by +30% and then fell by more than -50%. A real bloodbath for those who believed in the manipulation.
Media overclock
The partnership was concluded at the end of December. Below is a sampling of just some of the Telegram channels that shilled LeverFi in their resources. A coverage of several hundred thousand views in total on the bottom line.
Just during this media shilling, the price was up +126% at one point and then the entire increase was completely absorbed in just a few days.
Wash-trading
DWF Labs is doing aggressive wash-traing for this coin. Moreover, it is spinning only on Binance. With a capitalisation of $36 million, for the last 24 hours (23.01.2024) a total of $12 million has been “run”. At the same time, if you look at the chart below, you can perfectly see that there is no volatility on the coin now, it is in a calm state.
During artificial pumps, the volume on Binance can exceed the entire capitalisation of the coin by dozens of times. Fraudulent manipulation on the face of it.
Important: this bloated volume can only be done by DWF Labs. The daily scrolling of such a huge volume leads to huge expenses on exchange commissions. Binance, as well as other exchanges, provide project owners with accounts on the exchange to be able to spin wash-trading without charging for trading operations.
The chart shows the price run-up during the fake partnership with Microsoft.
The “official partnership” with DWF Labs also only resulted in a dump. The partnership was the reason of growth a few days before. Those who fell for the tales about a cool market maker — became weekend liquidity.
Token price history
However, such pampo-dump schemes are commonplace for LeverFi. In 2022–2023, there were 5–6 such stories.
DWF Labs / Mbox (MBOX)
Another partnership on 19 December 2023 is signed [*wa] with Mbox:
Project fraud facts
Users complained about the cheeky ponzi scheme devised by Mbox.
The scheme looked like this. A wallet was issued, into which it was possible to deposit coins from Binance. A person put, for example, 10 coins into the wallet. After a while he wanted to withdraw. And here it turned out that in order to withdraw coins, you had to have at least 50 coins on the account. That is, you had to buy another 40 coins and put them in the wallet. At a coin rate of $10 per piece, it was necessary to make a purchase for another $400. When the user finally topped up the wallet, it turned out that another +1 coin was needed, as the withdrawal fee was 1 token.
Of course, DWF Labs couldn’t have been unaware of this schematosis, contributing a solid cutlet to the project.
Media overclock
The partnership was signed in December in 2023. Therefore, the media space in Telegram for this month is being studied.
Here’s an example of how a shilling channel like 001k.Trade is selling hamsters this coin as a speculative trade:
These are just some of the Telegram channels from the general masses that shilled the coin during the pump:
All this publicity is to create output liquidity.
Wash-trading
The volumes are worth paying attention on this coin. A month before the “official partnership”, the price was accelerated by +36%. At the same time, a colossal wash-trading was included, the volume on this trading pair on Binance could exceed the coin’s capitalisation.
Then the “official partnership” comes out, the price accelerates another +60% and quickly rolls back.
As you can see, DWF Labs is once again only using the fact of an “official partnership” as a way to create exit liquidity in the form of retail traders, while continuing to spin volume and shill the coin through paid influencers.
Token price history
In summary, the token is a common scam that has collapsed by -98%.
DWF Labs / Algorand (ALGO)
Who is Algorand? Forklog writes (link — in russian version):
It is a high-performance blockchain platform with fast and cheap transactions, powered by a proprietary Pure Proof-of-Stake (PPoS) consensus algorithm. It supports smart contracts, decentralised applications and digital asset issuance.
An ecosystem of multiple DeFi, NFT and Web3 services is developing on the Algorand blockchain, and hundreds of solutions for the traditional economy are running.
Algorand is positioned as a “carbon-negative” blockchain, with a portion of transaction fees going to reforestation projects and other CO2 offset programmes.
26 June 2023 partnership (link — in russian version), which includes the purchase of $50 million worth of ALGO tokens.
The news even spread across major news media on Telegram:
You would think that the ALGO token would be bought out of the stack by the market. But no. So a wave of discontent rose, the coins were sold directly, not through the exchange tumbler. The community exploded with outrage: the Algorand team did not provide any details of the transaction. There were many questions:
- How many coins were sold (at what price)?
- Do tokens have lockout periods?
- Why would they sell tokens? Doesn’t the team have any more money?
The wave of outrage was so great that Algorand had to create a separate thread on Reddit.
CFO Algorand held an AMA session and agreed to answer all questions via emails, by passing posting answers on Reddit or Twitter. In fact, he didn’t answer anything.
Token price history
As is typical among DWF Labs partners, ALGO is yet another ponzi-skim that plummeted -97% in just a couple of weeks from listing. Then it was ramped up and dumped again at -97%.
It is interesting that the capitalisation of this company is now more than $1 billion. And this is after a -97% drop from the peak in 2021, i.e. at the peak the capitalisation of the company was over $40bn!
DWF Labs / EOS (EOS)
On 13 April 2023 DWF Labs invests in the token of Tether (link — in russian version) co-founder and Jeffrey Epstein accomplice Brock Pierce. The amount of investment in EOS is $60 million.
Project fraud facts
EOS is [*wa] famous for raising $4bn in an ICO without doing anything much in the following years. And it’s also known for buying the Voice[.]com domain for $30 million under “platform news”. The deal was done with Microstartegy and has officially entered the history books as the most expensive domain name sale ever. What’s more, the deal was done for cash, which in no way resembles ordinary money laundering.
Meanwhile, the deal was made with a company that in the noughties was remembered for a notable fraud (link — in russian version), and whose owner is sucking everyone he can into bitcoin. Sailor is now in favour of bullrun, and in 2014, when he really needed to buy, he was sinking (link — in russian version) bitcoin to the bottom.
Token price history
Another partner DWF Labs looks like a scam, merged 90% a couple of weeks after listing and -96% off the bull market in 2021.
DWF Labs / Conflux (CFX)
On 1 March 2023 DWF Labs is investing (link — in uktainian version) $10 million in Conflux. The news immediately went viral:
Project fraud facts
The Conflux ecosystem consists of “two major partners” of the team. These partners were selling Goledo Finance users a fake Goledo token instead of a real one. A thread was created on Reddit with collected complaints from affected retailers. An attempt to pull off a scam with different versions of a smart contract was repeated by DWF Labs with another project, such as GalaGames (below).
The shilling process was interesting. The coin did make 20 X’s. Except that the “partnership” announcement was posted after the coin made 10 X’s. The announcement was published, and from it the price first sagged by -50% before making x2.
Then, on 28 June 2023 DWF decides to “re-invest” $18 million in Conflux. Apparently too revolutionary a technology (no) not to pour into it. Immediately after the “investment” the price slides to -57% and can’t recover until now.
Media overclock
The acceleration in 2023 itself was carried out on a different principle. The coin made 20 X’s in just a month and a half, so marketing investments were needed accordingly. This is not an easy overclocking of the coin by 30–50–100%, as it was in the previous cases. They tried to make a really “big” story out of Conflux. First, DWF Labs overclocked the price, and then massively started shilling this token to all crypto resources. The posts in Telegram alone advertising the coin gained millions of views in the period of March-May 2023 (at the very peak of the token’s price).
Entire narratives have been invented:
- Conflux — Chinese Polygon
- Conflux — Chinese Ethereum (CoinDesk)
- The only public blockchain compliant with regulatory requirements in China
It’s particularly amusing when a media agency like MarketTwits, citing CoinDesk, writes:
Chinese investors may have a “leg up” on Conflux.
It’s not a word for the Chinese after a -70% drawdown.
Here’s another example of how big influencers like “001k.Trade” shilled the coin with the motif: “DWF Labs, as the cool MM of the market, flies into the coin with two feet and is now a rocket for sure”. The post went out on 2 June, two months later the price made -65%:
And after all, many retail participants do get the impression that when DWF Labs shows up as a partner, it’s to the tothemoon!
Coincidence or not, 4 days apart, two major TG channels “TT|Top Traders🏆analytics” and “Mr Mozart” are shilling the same token as early as 2024 in a similar format:
Wash-trading
According to Coinmarketcap, the current capitalisation of the coin is $600 million.
At the peak of the market, wash-trading per day exceeded the capitalisation of the whole coin. Recent short pumps on this trading pair alone were accompanied by big “washed” volumes, comparable to the capitalisation.
Token price history
A year later, it can be clearly noted — the partnership was only for the purpose of creating output liquidity in the form of hamsters.
Despite the -98.7% plum, despite the DWF Labs pump-and-dump, the crowd continues to quietly trade a coin they don’t even understand.
DWF Labs / TokenFi (TOKEN)
In November 2023, DWF Labs is partnering with TokenFi, another Fi clone created by the same team (link — in russian version) that created the FLOKI memtoken:
I wrote more about memtokens and the extent of this ponzi trend in a separate post (link — in russian version).
Project fraud facts
Floki’s marketing department in the UK has come under investigation by the Advertising Standards Commission. Floki’s token adverts, which were displayed as banners around London, used manipulative tactics “designed to infantilise” and “exploit the desires” of the audience, according to experts.
TokenFi itself looks like a regular crypto tinkerer designed to gather people and redirect them to “invest” in Floki.
Token price history
There have been no significant X’s on the coin yet. But, given that DWF Labs has already made a splash here, the coin is likely to fail before it shows any solid growth.
DWF Labs / GalaGames (GALA)
DWF Labs is partnering (link — in russian version) with GalaGames on 9 November 2023:
Project fraud facts
After entering into a “partnership”, the GALA token pulls off a sort of “token swap” scam, where old tokens are flipped into new tokens. Users who haven’t opened their wallets or stored GALA on Coinbase in a while have found that their tokens, when trying to send to another address, go to a “burn” address. A complaint from a Coinbase customer who faced the same situation.
In order to save money, it was necessary to add the new smart contract “GALA V2” to MetaMask and receive compensation on it at the time the network sent out notifications. Those who did not do so in time could no longer request compensation.
What’s ridiculous is that some mates in the comments on Reddit are also blaming the authors of the threads:
These are the kind of people who think cryptocurrency is a scam. And in reality, he is an idiot and blames others.
Or this one:
He just doesn’t understand how MetaMask works.
Instead of admitting the fact of fraud, these comrades accuse the author of the thread of incompetence. True behaviour of crypto sectarians (link — in russian version). Meanwhile, the same story was pulled with Conflux.
Also 11 months ago a major post goes up on Reddit listing all the lies the founders of GALA have been telling the public.
Wash-trading
It is interesting to track the history of token price behaviour in the context of a “partnership”.
First the price does +90%, volumes increase. Then the news about the partnership with DWF Labs comes out. On the same day there is a peak volume. Then another small growth and a natural absorption of this growth.
This is yet another example of how the announcement of a “partnership” with DWF Labs is just a way to create liquidity.
Token price history
According to the classics of the genre, the general chart of the coin looks like an ordinary ragpool. Firstly, the pump of 11 X’s and then the price dump below the listing price, by -98.5%.
Very similar to the SHIB memtoken, another scam pyramid scheme:
DWF Labs / Mask Network (MASK)
Concluded another partnership with Mask Network, 19 January 2023. Investments of $5 million have been made.
Project fraud facts
At the massive rate crash in the summer of 2023, users complained on Reddit that the team was “once again” dumping nearly $9 million in token bundles. Of course, no one warned the community or disclosed the purpose of the sales.
The token used a name consonant with Elon Musk’s surname, thus gaining popularity. It’s worth noting that many retail players can indeed associate Mask Network with Elon Musk. Although this is a misconception (link — in russian version):
Wash-trading
DWF Labs’ entry into the project this time did not lead to an immediate collapse, which is already good. At the moment the price even made more than +100% growth. But, quite expectedly, the price then completely absorbed all the growth and is trading at the marks at which the “legendary” partnership was concluded. The fact that pampodump was not such a failure for retail as in previous cases is explained quite simply: this token was practically not shilled in the media.
What’s far more bizarre is the fact that just a couple of days before the “sudden” FTX crash, the token made 6x. What is this, an attempt to jump on the train, knowing the insider?
Token price history
In fact, the token is another scam, collapsing at -95.7%.
DWF Labs / Radio Caca (RACA)
Another partnership, this time with Radio Kaka (in the original — “Радио Кака”), announcement released 5 April 2023. Invested $16 million.
Project fraud facts
“Radio Kaka” (in the original — “Радио Кака”) is remembered for throwing in fakes about joint “work” with Stanford’s AI lab and “cooperation” with Google. There was no collaboration with anyone of course. The story is reminiscent of LeverFi, when DWF Labs used a similar strategy: pretending to be a desired partnership and high retailers’ trust in the project.
Just a couple of weeks after investing, the “Kaka” token is draining at -70%.
Token price history
The price over two years suggests that this is another ragpool, the price has merged at -98.8%
DWF Labs / ArbDoge AI (AIDOGE)
ArbDoge AI is in the DWF Labs portfolio, it was not possible to determine when exactly the partnership was made.
Project fraud facts
What’s remarkable is that the coin is worth $0.00000000015. Apparently the marketing idea is that there are so many zeros after the decimal point that retailers will not be able to count them all if an extra one suddenly appears.
People on Reddit complain that every day the coin updates the bottom and he doesn’t know whether to buy more or sell or what to do at all.
This coin is a memtoken, an opinion on which I have posted (link — in russian version) more than once.
Token price history
The chart is a typical ragpool, plunging the price by -95.8%
DWF Labs / Waves (WAVES)
DWF Labs in July 2022 recognises the revolutionary nature of the protocol and officially flies into Waves, bringing “a voice of confidence to the Waves DAO” (i.e. DWF Labs is confident that founder Sasha Ivanov is a trustworthy guy, just all around FUD).
Project fraud facts
Sasha Ivanov, founder of Waves, successfully sunk (link — in russian version) the Vires Finance protocol by stealing $530 million in liquidity from traders between February and April 2022.
By the end of 2022 Sasha Ivanov will sink (link — in russian version) his own USDN steiblcoin and ban those who ask questions in the Telegram group.
The WAVES project is full of various fraudulent stories and murky schemes. The token was removed from the Ukrainian exchange Kuna on 12 April 2023. The exchange moved (link — in russian version) its native token KUN from the Waves blockchain to the ETH blockchain.
Token price history
As usual, what DWF Labs invests in is a ponzi pyramid scheme. In this case, the token merged at -98%.
DWF Labs / Synthetix (SNX)
On 20 March 2023 DWF Labs pours $20 million into Synthetix’s “DeFi liquidity protocol”. Another “ revolutionary technology”.
Project fraud facts
Synthetix launched the SUSD stablecoin, which has been steadily dropping to $0.97 and of course has no audits.
SUSD’s all-time market capitalisation graph is similar to the life cycle of a typical shieldcoin. Although the stablecoin hasn’t lost its peg since 2019, its popularity seems to have passed its peak in 2021, when all cryptocurrencies in a row gave growth.
Synthetix’s promised trades directly to stocks and fiat dollar 4 years ago never materialised, disassembles on Reddit.
Wash-trading
It is quite expected that after the announcement of the “official partnership” the price dropped by -45%. Also wash-trading was increased during the period of news release. As a result, the ace-moon did not happen, the price is trading at the same mark, where DWF Labs officially entered the project.
Token price history
The chart of the coin itself from Synthetix looks like a half-skim panel folded at -95% of the peak.
DWF Labs / Velo (VELO)
On 28 November 2023 DWF Labs is investing $10 million in Velo. The announcement is also on the DWF website.
Project fraud facts
Velo has a capitalisation of $31 million, with a daily traded volume of $8 million, a third of the total capitalisation. Powerful volume tipping (wash-trading):
Moreover, earlier this year, many days in a row, the trading volume exceeded $60 million per day:
Since 1 March 2023, Velo has been removed from the Crypto.com exchange, a thread on Reddit has been dedicated to the issue.
On 31 December 2023, Velo account on Twitter urges users not to click on the links in the Telegram chat of the project for 79 thousand participants, because the project has been “hacked” and all published from the official account announcements of big airdrop lead to the sites of scammers.
It looks as if you can trust these mates your money (no).
What is also interesting is that there are several variations of VELO, the uninformed retailer can get “confused”.
Velo / VELO ( coinmarketcap )
This is the coin written about above. It is traded on Huobi, Gate, Kucoin, OKEX, Bybit.
Velodrome Finance / VELODROME ( coinmarketcap )
Coin of another project, traded on OKEX, already under the ticket VELODROME. On some exchanges it is traded as VELO, for example, on BitGet or CoinEx. But, interestingly enough, the prices of the tokens are identical and you might get the impression that it’s the same company. But no!
They even have different websites, https://velodrome.finance/ and https://www.velo.org/ .
All of this would be clearly regarded as financial fraud by the US regulator DOJ.
Token price history
The overall chart of Velo coin looks like a ragpool, rolling into the bottom at -99.82%.
DWF Labs / Tellor Tributes (TRB)
It was not possible to find any specific information about the partnership of this company with DWF Labs. The fact of manipulation of this token from DWF can be learnt after the fact:
Token hasn’t rolled 98% yet, but the pump-and-dump pattern is obvious.
DWF Labs / Friends.tech
In September 2023 Grachev with the help of a single tweet, hyped (link — in russian version) the course of friends.tech’s ponzi scheme, in which users must pay money to chat with others on a social network on the blockchain.
“This is an absolutely obvious ponzi scheme,” writes one Reddit contributor in discussing the project’s “business model.”
DWF Labs / YGG, DODO, C98, CYBER
I wonder what the scandal was about in the summer of 2023?
Yield Guild Games (YGG)
The peak of the pump is 7 August 2023. On a daily basis the price looks like a classic pampo-dump:
On the 15th timeframe you can perfectly see how the price was accelerating little by little for 4 days, and then in just a couple of hours it was drained by -67%. A week after the pump, the price was already down by -82%.
DODO (DODO)
Pump peak on 8 August 2023, the day after the peak on YGG. Another pampodump, in the moment bringing x2 in just a couple of days.
Coin98 (С98)
The peak of the pumppodump on 9 August 2023, the day after the peak on DODO. It is relatively small pampodump, yielding +57% at the peak.
Cyber (CYBER)
The peak of the dump is on the 2 of September 2023. Powerful pump, bringing at the moment +450% and of course was then merged.
Analysis of these tokens
YGG, C98, and CYBER pumped in a row, one per day, sequentially. All three tokens are managed by DWF Labs, a “top market maker”. Also, anomalous activity on the wallets of these tokens is attributed to DWF Labs.
Analysis
The community was outraged by the abnormal pampo dumps of just four tokens in August-September last year.
In this article half a dozen and a half other projects managed by DWF Labs were sorted out. A typical process of price overclocking is described.
It works like this. The token of the next project is selected for a potential dump. Very often these are projects that have already “run out of steam” and are unable to do anything on their own to increase the price. The prices of their tokens have fallen to -95–99% of the maximums. Such projects did not declare bankruptcy and their managers did not disappear from the media space. But in fact, these are already the final ragpools.
The possibilities of squeezing out growth percentages are assessed, how much retail is now sitting in coin, how much current dirt there is on the project, what media opportunities can be used for this case. A strategy of price acceleration is chosen. It is not difficult to inject 5–10 million $ and make the price 500%, it is difficult to make the hamster buy at inflated prices. Here you need full control over the media resources of the project-partner, control over the commission-free account on the exchange, as well as confidence that the cofounders of the project-partner will unconditionally follow those instructions that gives DWF Labs.
A month before the “official partnership” is announced, wash-trading is turned on, usually on Binance. The price does from 50% to 10 x growth. Next, DWF Labs publishes an official partnership with the project. The price for some time can still grow by 30–50–100% and then guaranteed to merge below the price point at which the partnership was announced.
Sometimes shilling on Telegram is used, massively buying adverts from crypto bloggers of various scales. Sometimes even large publishers like CoinDesk are involved. Whenever possible, new PR narratives are invented, which retailers fall for.
Sometimes, along with the standard shilling scheme, if the project is already in trouble, darker ways of squeezing money are used, such as switching to a new “revolutionary” version2 smart contract. Or a “hack” of the project’s media resources is staged. Or the audience is deceived by black PR, information that does not correspond to reality is published and then refuted.
Conclusion
A few basic conclusions can be drawn:
- If DWF Labs has publicly partnered with any project, the token price growth will soon end and we should not expect growth in the near future. Moreover, if the “official partnership” is made after a rapid growth, it means that this event is 100% used to create an output liquidity in the form of retail.
- If DWF Labs partners with the project, there is a significant likelihood of discovering numerous instances of fraud within this project’s history. Hacks of official project pages, manipulations with smart contracts, manipulations with their own stablecoins, money laundering, and various fraudulent activities may be uncovered.
- DWF Labs often takes on projects that have experienced significant drops of -95–99% from their peak values. Essentially, these are “rug pulls,” but without publicly declared bankruptcies or the founders disappearing from the media space. Typically, retail investors have already exited such projects, selling tokens at substantial losses due to disappointment. Consequently, with a large percentage of the total supply in their hands, it becomes easy to manipulate the price.
- The narrative that “DWF Labs is a powerful market maker with a billion dollars in their pocket and will now boost the token price by 5–10x after the official partnership announcement” is nonsense. DWF Labs employs media shilling, including the fact of their partnership, merely to create an exit liquidity in the form of retail investors.
In DWF Labs’ management, there are almost 200 tokens. How many more pump and dump schemes have occurred with them — everyone can research on their own.
Similar market manipulations undermine trust in the entire industry. The chance to profit from such projects approaches zero unless a person is naturally friendly to the DWF Labs environment.