The EDGE token of the decentralized exchange edgeX experienced a sharp decline, losing over 70% of its value in less than an hour. The asset’s price dropped from approximately $1.13 to $0.34, but later partially recovered to $0.8. Currently, EDGE is trading around $0.65.
This is reported by Finway
Team’s Reaction and Initial Investigation Findings
The edgeX team responded promptly to the incident, emphasizing that the platform was not hacked and did not fall victim to an exploit or security breach. In an official statement, they noted:
“The edgeX protocol has not been compromised in any way. This was not a hack, exploit, or security breach.”
The developers pointed to preliminary results of an internal investigation indicating deliberate attempts by external parties to manipulate the market price of EDGE. The team confirmed that they are cooperating with centralized exchanges and other platforms to determine the cause of the incident. They promised to publish a detailed report after the investigation is completed.
Insider Control Allegations and Analysts’ Reactions
Notable on-chain researcher ZachXBT highlighted the abnormal concentration of EDGE in the hands of a limited group of individuals. In his opinion, such centralization created a risk of large-scale manipulation:
“We all know that the supply of edgeX tokens was effectively controlled by a small group of insiders under conditions of low circulating token volume.”
ZachXBT also urged the edgeX team to disclose information about their counterparties and agreements with market makers that could have influenced the events.
A user on X under the pseudonym giveno described the situation as a classic example of a “market maker’s farewell gesture.” He provided on-chain data indicating coordinated withdrawals from exchanges Bybit, OKX, Bitget, and Gate, a liquidity removal from SpotVault amounting to about $1.6 million, as well as mass liquidations totaling $2.81 million (of which $1.96 million were in long positions). Part of the tokens was distributed among addresses marked as exchange accounts in Arkham.
According to giveno, a similar scenario was observed during the collapse of the OM, LAYER, and RAVE tokens, indicating a repetition of the scheme concerning low-liquidity assets.
A similar incident previously occurred with the GUA token, which dropped 85% after a suspicious transaction related to a hacking attack.