Original article by Sam Kessler, Coindesk
Original title: Inside Movements Token-Dump Scandal: Secret Contracts, Shadow Advisors and Hidden Middlemen
Original translation: Scof, ChainCatcher
Event highlights:
Movement Labs is investigating whether it was misled into signing a market-making agreement without full knowledge, which handed control of 66 million MOVE tokens to an unidentified middleman, leading to a massive sell-off of $38 million worth of tokens immediately after they were launched.
Internal contracts show that Rentech, a company with almost no digital footprint, appears on both sides of the transaction: on the one hand, it is a subsidiary of Web 3 Port, and on the other hand, it appears as an agent of the Movement Foundation, raising questions about self-dealing behavior.
Insiders at the Movement Foundation initially warned about the deal, calling it potentially the worst agreement theyve ever seen; experts pointed out that the agreement could be structured to artificially raise token prices before dumping the tokens on retail investors.
The episode exposed deep divisions within Movement’s senior leadership: The conduct of executives, legal counsel and project consultants, among others, who pushed the deal forward despite internal opposition, is now under scrutiny.
A financial agreement that was originally intended to help launch the MOVE crypto token turned into a token-dumping scandal that not only led to a trading ban on Binance but also sparked a fierce internal dispute within the team.
Contract documents obtained by CoinDesk reveal the crux of the crisis and explain how it spiraled out of control.
Blockchain project Movement — the developer of the MOVE cryptocurrency — is investigating whether it was induced, without its full knowledge, to sign a financial agreement that gave a single entity unusually concentrated control over the MOVE token market, according to internal documents reviewed by CoinDesk.
This agreement led to 66 million MOVE tokens being quickly dumped into the market the day after the token was first listed on the exchange on December 9, causing the price of the token to plummet and arousing strong doubts about insider trading. It is worth noting that the project has been endorsed by World Liberty Financial, a crypto venture capital platform supported by Trump.
Cooper Scanlon, co-founder of Movement Labs, said in a Slack employee message on April 21 that the company is investigating why more than 5% of MOVE tokens originally reserved for market maker Web 3 Port were transferred through an intermediary called Rentech. He pointed out that the foundation was originally led to believe that Rentech was a subsidiary of Web 3 Port, which is clearly not the case. Rentech denied any false statements or misleading behavior.
A Slack message from Movement co-founder Cooper Scanlon. Rentech was spelled Rentek. (Source: CoinDesk)
According to an internal Movement Foundation memo, the contract Movement signed with Rentech effectively loaned out roughly half of all publicly available MOVE tokens to a single counterparty. This gave the entity an unusually large amount of control over the early-stage token. Multiple experts told CoinDesk that the arrangement was highly unusual.
What is even more worrying is that the version of the contract obtained by CoinDesk shows that it contains an incentive mechanism to induce manipulation of token prices to a fully diluted valuation of more than $5 billion, then dump the tokens to retail investors and share the profits in proportion. After reviewing the document, Zaki Manian, a veteran crypto project founder, said bluntly: Even participating in such a contract written in black and white is crazy.
Market makers are hired to provide liquidity for newly issued tokens, usually by buying and selling them on exchanges with funds borrowed by the token issuer, thereby stabilizing prices. But this role is also prone to abuse, allowing insiders to quietly manipulate the market and cash out large amounts of tokens without immediately raising alarm bells.
A series of contract documents obtained by CoinDesk sheds light on the crypto industry’s gray areas of weak regulation and opaque legal structures — loopholes that often turn public-facing projects into private vehicles for the benefit of a few.
Although rumors of market-making abuse are common in the crypto community, the specific details behind them are rarely made public.
The market-making contract reviewed by CoinDesk shows that Rentech appeared as both an agent of the Movement Foundation and a subsidiary of Web 3 Port in the agreement signed with the Movement Foundation. This dual identity arrangement theoretically enables it to dominate the terms and profit from them.
Ultimately, Movement’s partnership with Rentech led to wallets associated with Chinese financial company Web 3 Port, which claims to have worked with MyShell, GoPlus Security, and Trump-backed World Liberty Financial, quickly selling $38 million worth of MOVE tokens the day after they were listed on exchanges.
Due to the misconduct, the exchange Binance subsequently banned the market-making account, and Movement also announced that it would launch a token repurchase plan.
Similar to the stock option mechanism in startups, tokens in crypto projects usually have a lock-up period to prevent insiders from selling large amounts of tokens in the early trading stages of the project.
However, Binance’s ban decision has triggered market doubts about Movement - it is generally believed that the project may have reached some kind of early unlocking agreement with We b 3 Port, although Movement denies this.
Mutual accusations
Movement is one of the most popular crypto projects in recent years. It is positioned as a new generation of Layer 2 blockchain, aiming to improve the scalability of Ethereum based on the Move programming language launched by Facebook.
The project was founded by two 22-year-old young men, Rushi Manche and Cooper Scanlon, who dropped out of Vanderbilt University. It successfully raised $38 million, became part of World Liberty Financials investment portfolio, and attracted widespread attention on social media.
According to a Reuters report in January this year, Movement Labs was close to completing a $100 million round of financing, with a valuation of $3 billion.
CoinDesk spoke to more than a dozen people familiar with Movement’s inner workings, most of whom requested anonymity to avoid retaliation, among whom there were conflicting accounts of who led the Rentech deal — an arrangement that industry experts widely viewed as highly unusual.
Rentech head Galen Law-Kun denied that the foundation was misled during the contracting process and insisted that the entire structure of Rentech was built with the full assistance of Movement Foundation general counsel YK Pek.
However, according to an internal email and other communications reviewed by CoinDesk, Pek denied any involvement in the creation of Rentech and initially strongly opposed the deal.
In a message to employees, Movement Labs co-founder Scanlon said Movement was the victim in this incident.
Movement is also investigating the responsibilities of co-founder Rushi Manche, who initially forwarded the Rentech deal to the team and pushed it internally, and informal adviser Sam Thapaliya, who is also Law-Kun’s business partner, according to four people familiar with the matter.
We b 3 Port did not respond to multiple requests for comment.
“Probably the worst deal I’ve ever seen”
Although Movement initially rejected the risky market-making agreement with Rentech, it ultimately signed a revised version with similar content, relying solely on the guarantee provided by an intermediary with no track record.
In the crypto industry, which is extremely loosely regulated, project owners usually divide the operating structure into a non-profit foundation and a for-profit development company. The developer (here Movement Labs) is responsible for technical construction, while the foundation manages tokens and community resources.
The two should theoretically remain separate to avoid securities regulatory risks, but according to internal communications reviewed by CoinDesk, Movement Labs employee Rushi Manche appears to have also played a leading role in the nonprofit Movement Foundation.
Movement co-founder Rushi Manche forwards the first Rentech contract to an employee in the Movement ecosystem. (Source: CoinDesk)
On March 28, 2025, Manche sent a draft market-making agreement to the foundation on Telegram, stating that it needed to be signed as soon as possible.
November 27, 2025: Rentech proposed a draft market-making agreement to Movement. In the agreement, Rentech is the borrower and Movement is the lender. The agreement was not signed in the end. To protect privacy, CoinDesk has hidden some personal names in the disclosed documents, and some names have been obscured in the original documents in advance.
The draft proposes to lend up to 5% of MOVE tokens to Rentech, a company with no digital footprint at all.
Pek, the foundations legal counsel, said in an email that the agreement was probably the worst agreement Ive ever seen. In another memo, he warned that the move would hand over control of the MOVE market to an unidentified external entity. Marc Piano, the foundations director in the British Virgin Islands, also refused to sign the agreement.
The Movement Foundation’s general counsel YK Pek and director Marc Piano react to the Rentech deal (via CoinDesk)
A highly controversial clause in the contract allows Rentech to immediately liquidate its holdings if the “fully diluted valuation” of MOVE tokens exceeds $5 billion and share the profits 50:50 with the foundation.
Manian pointed out that this design actually encourages market makers to artificially raise the price of coins and then sell large quantities of tokens at high prices to make a profit.
Although the Movement Foundation ultimately rejected the draft, negotiations with Rentech are continuing.
Rentech then claimed to be a subsidiary of Chinese market maker Web 3 Port and offered to provide $60 million of its own collateral, a move that in part impressed the foundation, according to three people familiar with the negotiations and legal documents obtained by CoinDesk.
On December 8, 2024, the Movement Foundation finally signed a revised market-making agreement with Rentech, removing some of the most controversial clauses, including the cancellation of the clause that Web 3 Port could sue the Foundation for compensation if it failed to list MOVE on a specific exchange.
On December 8, 2025, Rentech and Movement reached a revised market-making agreement. In the agreement, Rentech is still the borrower, but its identity is clearly marked as We b 3 Port in the document (the name has been blurred in the document), and the Movement Foundation is the lender. The agreement has been officially signed. CoinDesk has processed some personal names in the document for privacy reasons, and some names have been originally obscured.
Although the revised agreement was drafted by Pek, the foundations legal counsel who had previously opposed the transaction, its core content is still highly similar to the original version: the agreement still allows We b 3 Port to borrow 5% of the total MOVE tokens and sell them for profit under a certain mechanism, although the method of fund transfer has been adjusted.
The new contract was signed by a director of Rentech on behalf of the borrower named We b 3 Port.
It is worth noting that domain name records show that on the day the agreement was signed, the domain name we b 3 port rentech.io belonging to the email address used by the director had just been registered.
Already had an appointment
According to three people familiar with the matter, when the relevant leaders of the Movement Foundation officially signed the agreement on December 8, they did not realize that We b 3 Port had already signed another agreement with Movement a few weeks ago.
On November 25, 2024, Rentech signed a market-making agreement with We b 3 Port (the name of We b 3 Port has been blurred in the document). In the agreement, Rentech is the lender and We b 3 Port is the borrower. Rentech is also referred to as Movement in the document. When CoinDesk obtained the contract, some of its content had been deleted, and CoinDesk further processed the names of individuals to protect privacy.
This version of the agreement shows that Web 3 Port has already reached an agreement with Movement, and its terms are highly similar to the initial market-making proposal that the Movement Foundation had previously rejected. In this contract, Rentech is listed as the representative of Movement.
Web 3 Port’s contract with Rentech allows borrowers to liquidate assets at 50% of their profits. (Source: CoinDesk)
The agreement, structured similarly to the Nov. 27 contract, explicitly allows market makers to liquidate MOVE tokens when the price reaches a certain target — one of the core provisions of the old agreement and a key issue that industry experts like Zaki Manian are particularly wary of.
“Shadow Co-Founder”
According to people familiar with the matter, there is a lot of speculation within Movement about who was behind the relationship with Rentech. This cooperation eventually led to the token sell-off in December last year, and also plunged Movement into a public opinion storm.
According to Blockworks, the agreement was initially circulated internally by Rushi Manche, who was briefly suspended last week while under investigation.
Manche responded to CoinDesk and said: “Throughout the market maker selection process, the MVMT Labs team trusted multiple advisors and members of the foundation team to provide advice and assist in designing the transaction structure. It is clear that at least one member of the foundation represented the interests of both parties in this transaction, which is something we are currently investigating further.”
The incident also raises questions about the role of Sam Thapaliya, founder of encryption protocol Zebec and one of the advisors to Manche and Scanlon.
Correspondence reviewed by CoinDesk shows Thapaliya was copied on an email from Web 3 Port to the “Movement team” and also appeared in other emails related to the market-making arrangement, alongside Rentech and Manche.
Web 3 Port copied Sam Thapaliya and Rushi Manche in the email to Rentech (the email was obtained by CoinDesk)
From what I understand, Sam is a close advisor to Rushi, a shadow third co-founder of sorts, one employee said. Rushi has always kept this relationship low-key, and we usually only hear his name occasionally.
“We often have internal decisions that have already been made, only to have them changed at the last minute,” said another employee. “Whenever that happens, we know it’s most likely Sam’s idea.”
Thapaliya was at Movement’s San Francisco offices the day the MOVE token went live to the public, according to three people who were present.
Telegram screenshots reviewed by CoinDesk also show that Movement co-founder Scanlon had commissioned Thapaliya to help screen the whitelist for the MOVE token airdrop — a strictly limited list of wallet addresses that can participate in the community’s coin giveaway (which has been postponed several times before).
The arrangement reinforced the impression among some employees that Thapaliya’s influence within Movement far outweighed that disclosed to the outside world.
Thapaliya told CoinDesk that he had known Rushi Manche and Cooper Scanlon since they were college students and had advised Movement as an external consultant. He stressed that he has “no shares in Movement Labs,” “no tokens from the Movement Foundation,” and “no decision-making power in either organization.”
Who is Rentech?
Rentech, the entity at the center of the token controversy, was founded by Galen Law-Kun, Thapaliya’s business partner. Law-Kun told CoinDesk that he set up Rentech as a subsidiary of Singapore-based financial services company Autonomy to connect crypto projects with family offices in Asia.
In a statement to CoinDesk, Galen Law-Kun said YK Pek “helped set up and served as general counsel for Autonomy SG, which was a parent or affiliate of Rentech.” He also claimed that despite Pek’s internal opposition to the initial agreement with Rentech, he “recommended setting up Rentech’s structure to move forward with the project launch” and “participated in drafting the first version of the contract, which was almost identical to the contract he later drafted and approved for the foundation.”
However, CoinDesk’s investigation has not found any evidence that Pek set up Rentech on behalf of Autonomy or drafted the first version of the contract.
In response, Pek explicitly responded: I am not and have never served as the general counsel of Galen or any of its entities. He further explained that a corporate administrative services company he co-founded did provide corporate secretarial services to more than 150 entities in the Web3 field, including two companies under Law-Kun. However, both companies were declared as no assets in their 2025 annual reports, and neither of them was Rentech.
Pek said that he had spent two hours reviewing a consulting agreement signed by Law-Kun for a project in 2024; in addition, he also contacted me about the FTX-related filing deadline and in August, he forwarded a Docusign NDA, which I only glanced at and did not charge any fees.
“I am completely confused and disturbed by Galen’s claim that I was his general counsel,” Pek concluded, adding that in email exchanges between Law-Kun and its corporate secretarial services partner, the other party was actually represented by a private attorney called “Hillington Group.”
According to YK Pek, “Both the general counsels of Movement Foundation (which I served as) and Movement Labs were introduced to GS Legal through Rushi Manche and were referred to as the legal representative of Rentech.”
According to Galen Law-Kun, Pek was introduced to 10 projects by him as Autonomys legal advisor, and never disputed or corrected this statement. Law-Kun also said that the introduction of GS Legal was just a formality in accordance with Movements request.
In a Slack message sent to employees, Movement co-founder Scanlon said the company has hired external audit firm Groom Lake to conduct an independent third-party investigation into recent abnormal market-making behavior.
“Movement is the victim in this incident,” he wrote in the message.
