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Gotbit CEO Arrested: Unveiling the Force Behind the “MEME Season”​

Gotbit CEO Arrested: Unveiling the Force Behind the “MEME Season”​ WikiBit 2024-10-17 12:22

Gotbit has officially confirmed that its CEO, Alex Andryunin, has been arrested in Portugal.

According to previous reports, on October 9, the U.S. Securities and Exchange Commission (SEC), the FBI, and the Department of Justice (DOJ) jointly filed lawsuits against four crypto companies, including Gotbit Consulting, ZM Quant Investment, and CLS Global, accusing them of self-trading market manipulation and multiple crimes related to cryptocurrencies such as Saitama, Robo Inu, and NexFundAI. A total of nine individuals were charged, with some defendants agreeing to separate settlements.

Following the announcement, several projects, including Hamster Kombat, Beercoin, and WaterCoin, clarified that they either did not use Gotbit as a market maker or had already replaced them.

On October 16, Gotbit officially confirmed: “Our CEO, Alex Andryunin, was arrested in Portugal. Currently, we have no further details.” Reports indicate that two Gotbit employees in Russia have also been charged.

The confirmation from U.S. authorities and Gotbit itself has drawn more attention to this market maker in the crypto industry, known for being a major force behind the “meme” trend. Why has it now come under legal scrutiny?

Starting with Fake Trades, Gaining Fame through Market Making for Meme Tokens

Gotbit was founded in 2018 during the ICO boom, when its founder Alexey Andryunin was a 20-year-old college freshman.

In 2019, a CoinDesk article exposed Gotbits involvement in faking trading volumes by programming bots to make token transactions appear more active, helping clients get listed on small exchanges and eventually on CoinMarketCap.

Alexey mentioned that exchanges were aware of the manipulation but had no interest in stopping it. By that time, 300 to 500 projects listed on CoinMarketCap were Gotbits clients. Despite his skepticism about the long-term viability, Gotbit continued growing. At the end of 2022, Gotbit emerged as the market maker for the Solana-based meme coin Bonk, which saw a significant increase in value.

By the end of 2023, Gotbit helped ANALOS achieve an incredible 3,700x price surge in just one week, making it a secret to wealth for meme coin traders.

As memes remained hot in 2024, Gotbit shifted its focus to market-making services for popular meme tokens like BEER and WATER.

Based on Gotbits publicly available partnership information, it can be observed that Gotbit has collaborated on over 50 projects, with more than 90% of them being meme projects. A majority of these meme projects are based on the Solana blockchain. Their pinned tweet features a collaboration with Neiro, recently listed on Binance.

On-Chain Detective‘s Disclosure

In September 2023, on-chain detective ZachXBT shared a document on X revealing Gotbit’s market-making strategies:

In the first few minutes of price discovery, Gotbit boosts token prices by 10x to create FOMO and sell all tokens at the peak.

Their focus during the first 12 hours is to exploit arbitrage opportunities for fast profits.

On launch day, Gotbit aims for $50 million in trading volume, primarily through CEX.

The goal is to achieve a 20x peak post-launch and 25x within the first month.

ZachXBT warned users about Gotbit‘s practices, while Lookonchain highlighted fraudulent behavior in Gotbit’s MEME tokens like BEER and WATER, which crashed after price spikes. Some of these projects may even have rug-pulled.

Disclaimer:

The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.

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