Cryptocurrency exchange Bitget has announced plans to pursue legal action against eight accounts suspected of orchestrating a sophisticated market manipulation scheme involving the VOXEL token, resulting in illicit profits exceeding $20 million.
The move comes in response to unusual trading activity detected on April 20, 2025, which caused a major surge in the token’s trading volume and price.
As the investigation unfolds, Bitget is taking seems to be taking decisive steps to address the incident and restore trust among its user base.
VOXEL, the native token of the Polygon-based role-playing game Voxie Tactics, is a relatively obscure cryptocurrency, ranked outside the top 700 by market capitalization.
On April 20, its trading volume on Bitget’s VOXEL/USDT perpetual futures market skyrocketed to $12.7 billion, surpassing Bitcoin’s $4.76 billion on the same platform.
This unprecedented spike was accompanied by a price increase of over 500% compared to its value just two days earlier.
The sudden activity raised red flags, prompting Bitget to suspend trading, freeze suspicious accounts, and initiate a rollback of trades executed during the affected period, specifically between 8:00 and 8:30 UTC.
According to Bitget’s Head of Asia, Xie Jiayin, the exchange has identified the eight accounts as part of a coordinated “professional arbitrage” group.
These accounts allegedly exploited a glitch in Bitget’s market-making system, which caused trades to execute repeatedly within a narrow price range of $0.125 to $0.138.
Some traders capitalized on this anomaly, with reports of individuals turning investments as small as $100 into six-figure profits within minutes.
Xie Jiayin stated via social media that Bitget will issue lawyer’s letters to the account holders, signaling the potential for formal legal proceedings.
The exchange has committed to distributing any recovered funds to affected users via airdrops, reinforcing its focus on user protection.
As widely reported, Bitget’s response has drawn mixed reactions from the crypto community.
While some commend the platform’s swift action, others criticize its handling of the situation, arguing that the rollback of trades and forced settlement of contracts at discounted rates unfairly penalized retail traders.
Critics have also pointed to Bitget’s hybrid custody model and lack of third-party market makers as systemic vulnerabilities that may have enabled the incident.
One analyst described the exchange’s internal market-making system as a “gaping architectural weakness,” raising concerns about potential conflicts of interest and inadequate safeguards.
To address these concerns, Bitget has pledged to release a detailed report on the incident, outlining the sequence of events and the technical factors involved.
The exchange has also promised to compensate users who incurred losses during the affected period, reportedly backed by its $300 million protection fund.
Despite the backlash, Bitget remains a major player in the crypto space, claiming over 100 million users and a daily trading volume of $20 billion.
As Bitget navigates the fallout from the VOXEL incident, the broader web3 and cryptocurrency industry continues to grapple with issues of market integrity and regulatory oversight.
The outcome of this case could potentially set a precedent for how crypto exchanges handle manipulation and technical glitches moving forward.