A prominent cryptocurrency exchange is pursuing legal action after severe VOXEL token manipulation rocked its platform, aiming to reclaim over $20 million allegedly obtained through exploiting market vulnerabilities.
The exchange announced its intention to issue eight legal letters targeting accounts believed to be interconnected and responsible for the market disruption. Jiayin Xie, the platform’s Head of Asia, stated on April 27 that these entities formed a “professional wool-pulling interest group” which improperly profited from the incident.
[April 27, 2025]
Xie emphasized a commitment to user restitution, pledging that 100% of any funds recovered through the legal process would be distributed back to platform users via airdrops.
Reassurances were offered to ordinary users who traded VOXEL during the critical window (16:00-16:30 on April 20) but had already withdrawn funds; these accounts have been unfrozen, and no further action will be taken against them. The exchange expressed regret for the disruption and promised a comprehensive incident report soon.
The underlying event unfolded on April 20 when the VOXEL token price skyrocketed by over 200% in just 30 minutes. For a brief period, its trading volume surpassed even Bitcoin on the exchange. During this dramatic climb from approximately $0.125 to $0.1645, trades seemed to execute outside the normal order book process.
A suspected malfunction in the exchange’s automated market-making system is cited as the cause, leading to erratic price movements and immediate order fills, which some traders exploited for substantial gains. In response, the exchange temporarily suspended the VOXEL/USDT contract and froze accounts linked to the suspicious activity.
The platform also confirmed it would reverse the irregular trades and compensate users who suffered losses. While asserting the issue wasn’t due to an internal system breach or external hack, the identities behind the manipulation have not been disclosed. This situation highlights the importance of understanding [[Choosing a Secure Crypto Exchange]] for traders.
This incident inevitably draws comparisons to a previous market manipulation event in March concerning the JELLY token on the Hyperliquid platform. Critics have noted potential inconsistencies, as the exchange’s CEO, Gracy Chen, had previously been vocal in criticizing Hyperliquid’s handling of its own crisis, underscoring the complexities of addressing [[Market Manipulation Explained]] in the fast-paced digital asset markets.