Binance, the world's largest crypto exchange by volume, rolled out a revised set of market maker rules on July 23, targeting hidden manipulation in token trading. Projects must now reveal their market makers' identities and full contract terms to Binance. The exchange outright banned profit-sharing agreements and guaranteed returns —two common tools previously used to incentivize price manipulation.
Ending Secret Maker Deals
For years, deals between new token projects and market makers stayed behind closed doors, enabling wash trading and fake volume. Under the new rules, any project that fails to disclose its maker's identity or hides profit-sharing clauses risks delisting. Binance said market makers can no longer receive a cut of price gains; they must focus solely on providing genuine liquidity so retail traders get tight spreads and fair execution.
Four Red Flags: Permanent Bans for Abuse
Binance also deployed on-chain surveillance to catch four manipulation patterns that trigger lifetime bans: coordinated dumping —makers dumping large amounts of the same token across multiple exchanges simultaneously; one-sided order books —far more sell orders than buy orders to create artificial selling pressure; fake volume through circular trading; and unauthorized token lending. If a project lends tokens to a maker, the usage must be clearly stated—makers cannot borrow tokens to short them or sell ahead of scheduled unlocks. Binance will track release schedules to prevent front-running.
Industry Shift: Transparency as Foundation
Industry observers argue that these rules mark crypto's "coming of age." While hype-driven 100x pumps may become rarer, quality projects backed by real demand will benefit from a cleaner market. Transparent maker rules build trust among retail investors, encouraging longer holding periods. The move also pressures other exchanges to adopt similar standards, potentially phasing out predatory market-making practices across the sector.
Trading digital assets involves high risk. This article is for informational purposes only—not financial advice. Always consult a professional advisor and invest only what you can afford to lose.