Trove Markets Accused of $10 Million HYPE Token Dump Amid Fraud Concerns
Trove Markets is going through mounting scrutiny after allegedly dumping over $10 million in $HYPE tokens inside a 24-hour interval. The Web3 decentralized perpetual alternate is constructed on Hyperliquid’s HIP-3 protocol.
These tokens, initially acquired for staking to launch the DEX, had been offered from a pockets linked to the venture, elevating suspicions of insider manipulation and undermining group belief.
Trove Markets Faces Allegations Over $10 Million HYPE Dump
The venture had raised $20 million by way of an preliminary coin providing (ICO) to safe 500,000 $HYPE tokens, a stake required for permissionless deployment beneath Hyperliquid’s HIP-3 protocol.
On-chain knowledge from pockets 0xebe07e526c4dc5f0005801bbd7d9850c424cf719 confirms that gross sales started with a modest 6,196 $HYPE price roughly $160,000 at current HYPE rates.
However, the exercise rapidly escalated. Hyperliquid News reported that Trove Markets initially liquidated $5 million in tokens, with whole gross sales reaching 194,273 HYPE tokens, equal to roughly $10 million, inside a single day.
Complicating the state of affairs, Trove’s founder reportedly publicly denied management over the pockets and requested its shutdown. Still, the pockets resumed gross sales minutes later.
“A couple of minutes after the founder of @TroveMarkets mentioned that he doesn’t management the pockets, and that he’s asking for the pockets to be shut down, it begins promoting once more, reaching 194,272.79 $HYPE in 24 hours,” Hyperliquid News reported.
The fast continuation of gross sales fueled hypothesis of both insider fraud or compromised pockets entry, intensifying group concern.
Hyperliquid Foundation Engages ZachXBT to Investigate
This controversy provides to present criticism surrounding Trove Markets’ ICO. The providing was prolonged on the final minute and oversubscribed, in the end elevating $11.9 million at a totally diluted valuation of $20 million.
Confusion over the ICO reportedly led to losses of round $73,000 for Polymarket prediction market customers.
Reports additionally emerged that the venture paid influencers $5,000 monthly to advertise the token whereas allegedly concealing staff members’ Iranian origins, elevating additional transparency considerations.
Community members, together with NMTD8, additionally flagged Trove’s funding within the controversial XMR1 venture and the delay in staking the HYPE tokens.
The common sentiment is that each one these prompt a technique to extract funds with out fulfilling ICO obligations. The HYPE token has since dropped roughly 60% under its ICO worth, leaving early traders uncovered.
In response, the Hyperliquid Foundation donated 10,000 $HYPE to blockchain investigator ZachXBT. This alerts efforts to probe the token gross sales and distance the protocol from potential misconduct.
ZachXBT, recognized for tracking crypto fraud and recovering stolen funds, is anticipated to offer readability on whether or not the gross sales had been half of coordinated misconduct or operational mismanagement.
Despite the controversy, Trove Markets stays operational with mainnet plans set for February 2026. However, the TGE (token technology occasion) has been pushed to 4 PM UTC on Monday, January 19, 2026, two hours after the initial 7 PM UTC.
Yet, partial token dumps and the erosion of belief put the venture in danger of failing to fulfill staking necessities beneath HIP-3. This might forestall the DEX launch and go away traders with out recourse.
Trove markets didn’t instantly reply to BeInCrypto’s request for remark. Nevertheless, the incident mirrors the dangers inherent in newer DeFi initiatives, notably these involving permissionless protocols, massive token allocations, and restricted transparency.
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