By ChandlerZ, Foresight News
On March 24, according to Binance's official announcement, its internal audit team received a report on March 23, 2025, accusing an employee of using insider information to conduct front-running transactions to obtain improper benefits. Binance launched a comprehensive internal investigation.
At the time of the alleged incident, this person was working within the Binance Wallet team, which had no business relationship or cooperation with the project in question. However, he is suspected of abusing information from his previous position for personal gain. Before joining the wallet team a month ago, the employee worked in a business development position at BNB Chain. He used the information he obtained in his previous position and his familiarity with the on-chain project to know that the project was in the TGE, and used multiple linked wallet addresses to purchase a large number of project tokens before the project publicly released the token announcement.
Following the announcement, the employee quickly sold a portion of his token holdings at a substantial profit, while retaining a significant amount of unrealized gains on the remaining tokens. Based on non-public information obtained from his previous position, this behavior constituted front-running and a clear violation of company policy.
The preliminary investigation has been completed, the person involved has been suspended and will face legal prosecution. In addition, Binance has completed the verification and deduplication of the report, and will distribute the $100,000 reward equally to the reporter.
Evidence on the chain catches the rat’s tail
According to the exposure of X user @土澳大狮兄BroLeon, Binance employee Freddie Ng was accused of suspected illegal insider trading and participated in the UUU token arbitrage of $110,000. After he made the on-chain information public, he asked Binance to give a reasonable explanation for the matter.
BroLeon said, "The insider trading of UUU tokens has been confirmed! I just verified the report, and the whole process of stealing was exposed on the chain. I don’t know how Freddie Ng, the Binance wallet BD and growth employee who was caught in the insider trading this time, will be dealt with."
According to the entire crime process, a Binance employee named Freddie Ng must have known in advance that the UUU token was going to be pumped up. He used his own small address starting with 0xEDb0 to spend 10 BNB to buy 24.1 million tokens at an average price of $0.00026, with a value of $312,000, and transferred all of them to a wallet starting with 0x44a.
Subsequently, Freddie sold 6.02 million UUU tokens at an average price of $0.0188 through the Bitget wallet, earning $113,600, and distributed the remaining UUU tokens to 8 different addresses, with each address receiving tens of thousands of dollars.
BroLeon said, "This guy made a mistake. The money he used to buy the insider trading was transferred from his real-name wallet freddieng.bnb (starting with 0x77C) 121 days ago."
On March 23, BNB Chain trading platform uDex officially launched its official token UUU on four.meme. uDEX is one of the members of the eighth season of BNBChain MVB. It provides users with on-chain information and allows users to trade directly from social networks. Currently, the token has a market value of $8.22 million.
The industry's chronic problems are difficult to cure
Insider trading is not a problem unique to the cryptocurrency market. Taking the historical data of the U.S. Securities and Exchange Commission (SEC) as an example, insider trading-related enforcement cases account for an average of 8-9% of the total annual enforcement, a proportion that already exists in traditional financial markets.
This is not the first time that Binance has faced insider trading suspicions, but few employees have been investigated before. Since 2018, the cryptocurrency industry has continued to have systematic doubts about internal trading on trading platforms. Many exchanges have been accused of similar insider trading problems at different times, which has become a chronic problem in the industry.
The transparency and decentralization of the cryptocurrency market have not completely eliminated the risk of insider trading. On the contrary, due to the lack of unified supervision and imperfect internal control, trading platforms are prone to become a hotbed for such behavior. Although major exchanges have strengthened the construction of compliance and risk control systems, the anonymity, technical complexity and global operation model of cryptocurrency still make traditional regulatory measures face considerable challenges in implementation.
Industry giants such as Binance often show a strong deterrent effect when facing the problem of insider trading abuse, but similar incidents often occur due to the lack of effective prevention and monitoring measures. Externally, Binance's rapid investigation results and actions show its determination to rectify the problem, but whether it can completely eliminate the problem of insider trading still requires the industry to strengthen compliance management and transparency from the source.
