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On March 23, Binance’s internal audit team received a complaint against a Binance Wallet employee who previously held a business development position at BNB Chain. The investigation revealed that he used confidential information from his former job for personal gain.
Details of the incident
The infringer knew that a popular project was preparing to generate tokens (TGE). Before the official announcement of the event, he used several wallets to buy coins of this project. After the announcement of the launch, a Binance Wallet employee sold some of the assets, recording a significant profit.
Binance representatives noted that the investigation did not uncover insider trading within the wallet team itself. At the time of the incident, the Binance Wallet division did not have a business relationship with the project mentioned in the complaint, so it should not have had access to classified information about it.
The crypto exchange suspended the infringer from work. His actions were classified as frontrunning (front-running), which is illegal trading based on insider information.
Binance is going to seize all illegally obtained assets and turn the case over to the authorities. The four whistleblowers who first reported the breach were paid a total of $100,000.
Binance did not reveal who exactly was behind the insider trading. The crypto community decided to find out for themselves. Some users confirm that the infringer was Freddie Ng, who recently made over $100k on the UUU token.
He reportedly spent about $6k to buy 24.1 million UUU (2.4% of the total supply). During the surge, Ng sold 6 million UUU, making a profit of $113k. The remaining coins – about 18.1 million UUU totaling $200k – remained in his nine wallets.
Many members of the crypto community have bombarded Binance with criticism.
“This is terrible and could potentially destroy all the trust you have built up for so long. So please deal with this properly and let the public know the outcome. As a BNB owner, it is almost unbearable for me to see this kind of thing happening again and again,” wrote one of the users.
The cryptocurrency exchange has been repeatedly accused of insider trading.
How It Went
Binance Wallet BD employee Freddie Ng is suspected of making realized gains of over $113,000 and unrealized gains of $200,000 through trading the UUU token on the Binance Smart Chain (BSC). This was reported by journalist Colin Wu, citing BscScan.
According to Wu, a user of the freddieng.bnb wallet address spent $6227 to buy 24.1 million UUU tokens, accounting for 2.4 percent of the asset’s total supply.
He subsequently sold 6.03 million UUU through linked addresses, which brought in $113,600. Currently, 18.1 million UUU, worth about $200,000, are still held at nine addresses, the journalist noted.
Binance has imposed investment limits on its employees
Cryptocurrency exchange Binance has introduced new restrictions on crypto asset investments on the platform for employees, limiting the maximum amount. This was announced by journalist Colin Wu, citing his sources.
According to Wu, Binance has notified employees of adjustments to the policy limiting investment in crypto assets on the platform. According to the announcement, investment is limited to $5,000 per year.
In addition, the notice does not apply to employees in the listing department of new crypto assets. Wu did not specify whether and what other restrictions apply to them.
Incrypted’s editorial team has reached out to exchange representatives for comment on the matter. We will update the story when and if we get a response.
a spokesperson for the exchange noted that there were some inaccuracies in the information being shared on social media. However, he confirmed that tighter restrictions are applied to staff who handle “sensitive” transactions.
“We regularly review our staff policies. While we encourage our employees to use our own products, we always remind them that our users should be at the center of everything we do,” the company added.
What has this policy been like in the past?
In 2018, former Binance CEO Changpeng Zhao told Yahoo Finance that the exchange allowed employees to store cryptocurrency. However, they had to get permission to trade it, and wait up to 30 days before making a new trade.
According to Zhao, this rule had been in effect at the company since it started operations. However, the policy appears to have been tightened later;
In August 2023, Zhao declared that all employees, including himself, were prohibited from trading in the futures market. Employees of the product testing department, in turn, had certain quotas.
At that time, it was also reported that the waiting period before selling previously purchased crypto-assets was increased to 90 days. This was later confirmed by Binance co-founder Yi He;
Over time, Zhao appears to have changed his mind, at least in part. In a post on X (formerly Twitter) in February 2025, he noted that the trading ban could lead to Binance managers having a poor understanding of users’ needs.
Last February, a scandal erupted over the listing of Ronin (RON). Later, analysts noticed a suspicious transaction the day before the listing of memcoin Book of Meme (BOME).
Amid the allegations, Binance tightened the rules for adding new coins to the platform. The platform promised to pay from $10 thousand to $5 million for information about illegal actions of its employees.
