Binance’s Initial Exchange Offering (IEO) project Hooked Protocol (HOOK) received criticism this week over suspected insider trading before the announcement of a $50 million funding.
According to a tweet by Wu Blockchain on X, a multi-signature address allegedly linked to the Hooked Protocol team transferred HOOK tokens worth $4.52 million to Binance just hours before the project publicly announced a $50 million Education Ecosystem Fund.
Following the announcement, HOOK’s value briefly spiked to $1.24 before dropping back down to $1.05 over the next four hours.
The timing of the large token transfer right before the news release suggests certain insiders may have unfairly profited from private knowledge of the upcoming announcement.
In the funding statement, Hooked Protocol said the $50 million fund is intended to support the HOOK 2.0 ecosystem and drive new applications of the HOOK token.
The controversy comes shortly after Hooked Protocol was first listed on Binance with the support of former Binance CEO Changpeng Zhao. At press time, HOOK is trading around $1.08.
While the token has seen a 16% increase over the past month, the community backlash over perceived insider self-dealing continues.