Unchained At What Price Freedom? Stopping ‘All-Out Crime’ in Crypto Market Making - Ep. 809
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Apr 1, 2025 Kain Warwick, founder of Infinex App and Synthetix, dives into the murky waters of crypto market making. He unpacks how some market makers have strayed into unethical practices, highlighting a recent incident involving Binance. Kain details the intricacies of token evaluations and the centralization crisis exemplified by the $JELLY attack on Hyperliquid. He also addresses the strategic dilemmas in balancing security and user experience in DeFi, shedding light on the innovative solutions Infinex is developing to navigate these challenges.
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Early Crypto Market Manipulation
- During the ICO era, market makers realized they could manipulate low-liquidity crypto markets.
- They would "juice up" the buy side to artificially inflate prices and profit from the resulting volatility.
Widespread Manipulation in ICOs
- Almost every ICO in 2017-2018 experienced market manipulation, especially on Korean exchanges.
- Market makers exploited the large spreads and lack of efficient arbitrage.
ICO Marketing Firm Exploitation
- Similar to market makers, marketing firms extracted value during the ICO boom without providing real value.
- They would charge high fees for services like whitepaper writing and then dump their tokens.