MSTR Cat

Crypto Law/Level VI · Market conduct/6.1 Manipulation/Lesson 6

Market makers and manufactured volume

The difference between providing liquidity and selling fake activity, told through the US prosecutions of crypto ‘market makers’ from 2024 to 2026 and what they mean for the projects that hire them.

Education, not legal, tax or investment advice. Crypto law differs between countries and states and changes often. Check the current rules where you live with a qualified lawyer or tax adviser before you act.

The lean path

The cheapest, lowest-tax, simplest and most private route the law allows, best first. Each step names the rule it rests on and the condition that keeps it lawful.

  1. Cheapest lawful course: hire no market maker and let a public pool supply liquidity, with no fee and no manufactured-volume risk. Catch: thin markets move sharply, and you must never describe trading activity you do not have.
  2. If you hire one, pay for quoted depth and spreads, never for daily volume, trending placement or price targets; contracts buying an appearance put token leaders alongside the firms in the 2024 Boston charges. Get the strategy in writing.
  3. Put a written ban on self-trading and trading between controlled accounts into the contract; Gotbit forfeited about $23 million, and MyTrade had to post that ‘volume support is a form of wash trading’. Catch: clients who paid for volume were charged too.
  4. Disclose the arrangement publicly: who the market maker is, any token loan or option it holds, and when it may sell. A short disclosure costs nothing, while a half-truth about float or liquidity invites fraud claims.

MaterialsThe US Attorney’s Office (District of Massachusetts) release of 13 June 2025 on the sentencing of Gotbit and its founderThe US Attorney’s Office (Northern District of California) release of 30 March 2026 charging ten employees of four market-making firmsSEC press release 2024-166 (9 October 2024) on three so-called market makersAny market-making proposal or agreement a token project has received, with its performance targets

Wonder

  1. What does a legitimate market maker actually do for a token?
  2. If a project pays a firm for ‘volume support’, who is responsible for the fake trades?
  3. What wording in a market-making deal should make a builder stop and ask questions?

Explore

  1. In ordinary markets a market maker stands ready to buy and sell, posting bids and offers on both sides and earning the spread between them. That makes trading easier for everyone and is lawful. New tokens often hire such firms so that buyers and sellers can trade without large price jumps. The prosecutions in this lesson concern a different product sold under the same name: trades with no change of owner, made to create volume and price movement that looks organic. The core law is in lesson 6.1.2; this lesson looks at the firms and at the projects that paid them.
  2. Gotbit is the leading example. According to the Justice Department, between 2018 and 2024 it supplied artificial trading volume to multiple token companies. Its founder, Aleksei Andriunin, described in a 2019 interview how he wrote code to wash trade so tokens could be listed on CoinMarketCap and on larger exchanges, and kept spreadsheets comparing ‘Created Volume’ with ‘Market Volume’. Staff explained to clients how multiple accounts avoided detection on the public blockchain. Gotbit admitted manipulating price and volume for clients including the Saitama and Robo Inu tokens, and received tens of millions of dollars in payments.
  3. Andriunin was arrested in Portugal on 8 October 2024, extradited on 25 February 2025 and pleaded guilty in March 2025 to wire fraud and conspiracy to commit market manipulation and wire fraud. On 12 June 2025 Judge Angel Kelley sentenced him to eight months in prison and a year of supervised release. Gotbit forfeited about $23 million in seized crypto and was put on five years’ probation, during which it must cease to exist or operate. The same Boston operation produced pleas from MyTrade and CLS Global; MyTrade’s founder was sentenced on 6 August 2026 to a $10,000 fine.
  4. The evidence was largely the firms’ own sales talk. Employees of ZM Quant allegedly told an FBI-created client on a March 2024 video call that they would trade ‘maybe ten times per minute or twenty times a minute’ to ‘increase the trading volume’ and ‘pump the price’, using many wallets so trading would not look ‘fake’. MyTrade offered a dashboard where clients picked their daily wash-trade volume, labelled ‘Volume Support’. According to the charges, its founder said such volume could get exchanges to waive listing fees. As part of his plea, MyTrade had to post a website notice that ‘Volume support is a form of wash trading’.
  5. A second operation followed. On 30 March 2026 prosecutors in Oakland announced indictments of ten executives and employees of four firms, Gotbit, Vortex, Antier and Contrarian, after an FBI and IRS undercover operation in which agents created several tokens. The indictments allege the firms both inflated volume and price and planned to sell their own token holdings at the inflated prices. Two defendants had already pleaded guilty and been sentenced; three, including two chief executives, were extradited from Singapore. Earlier, in October 2024, the SEC had alleged that the bots of some such firms at times generated billions of dollars of artificial volume a day.
  6. Clients are not shielded by outsourcing. In the Boston cases, leaders of token companies that hired these firms were charged with market manipulation themselves (lesson 6.1.1), and the SEC sued promoters alongside the firms. For builders, the risk sits in the contract: a deal that pays for daily volume, ‘trending’ placement or a price target, rather than for quoted depth and spreads, is paying for an appearance. A practical check: ask for the strategy in writing, ask whether the firm ever trades with itself or between accounts it controls, and compare the agreement’s metrics with what an honest liquidity provider would report.

Key facts

  • Gotbit’s founder Aleksei Andriunin was sentenced on 12 June 2025 in Boston to eight months in prison after pleading guilty to wire fraud and conspiracy to commit market manipulation and wire fraud.
  • Gotbit forfeited about $23 million in seized crypto and was sentenced to five years’ probation during which it must cease to exist or operate.
  • According to the Justice Department, Gotbit kept spreadsheets comparing ‘Created Volume’ from wash trades with naturally occurring ‘Market Volume’.
  • MyTrade’s ‘Volume Support’ dashboard let clients choose the amount of daily wash trading on named exchanges; its founder was sentenced on 6 August 2026 to a $10,000 fine.
  • On 30 March 2026 federal prosecutors in Oakland announced indictments of ten employees of the firms Gotbit, Vortex, Antier and Contrarian for inflating crypto trading volume and prices.
  • In the 2024 Boston cases, leaders of token companies that hired wash-trading firms were charged alongside the firms.

Exercise nine, six, three, one

9CollectList up to 9 promises or metrics that appear in market-making offers you have seen or can imagine, such as spread targets, order-book depth, daily volume figures, ‘trending’ placement or price support.
6ClusterSort them into 6 categories: spread commitments, depth commitments, volume targets, price targets, listing or ranking help, and reporting to the client.
3DistillReduce the 6 categories to 3 groups: services consistent with genuine liquidity, services that can only be delivered by fake trades or manipulation, and services that depend on how they are carried out.
1CrystallizeWrite 1 sentence explaining, in your own words, why paying a firm for trading volume can expose a token’s own team to manipulation charges.

Fact check

Dates, figures and claims checked against the published sources listed below.

Open in the interactive academy →

PT ES ZH JA KO RU DE FR MS