The Movement Labs Whirlwind Intensifies, Causing Notable Losses for MOVE Token Holders

The whirlwind of issues at Movement Labs continues, leading to further losses for MOVE token holders. A new development following the Coinbase delisting announcement has seen the problems deepen.

Problems surrounding market maker actions have soured sentiment for the ecosystem for over a month now.

Movement Labs Co-Founder Rushi Manche Suspended

Following Coinbase’s announcement of plans to delist the MOVE token, Movement Labs has suspended Rushi Manche, its co-founder, as part of ongoing third-party investigations into a market maker.

“We can confirm that Rushi Manche has been suspended from Movement Labs. This decision was made in light of recent events and as the third-party review is still being conducted by Groom Lake regarding organizational governance and recent incidents involving a market maker,” wrote Movement.

The debacle in question concerns a market maker scandal involving Web3Port, which recently saw it allegedly dumping 66 million MOVE tokens. The incident caused a 20% crash in the token price.

As it happened, Binance exchange penalized a market maker for the Movement project for violating trading regulations, freezing its potential profits.

Recently, Movement Labs launched a third-party investigation into alleged market maker misconduct involving the MOVE token. Interestingly, they launched this investigation during Manche’s temporary leave of absence.

However, Manche had disputed reports of his departure from the project.

“Very much still at Movement. Missed company offsite because I was in Asia for Web3Festival,” Manche said on X.

Manche also responded to speculation about his status on Slack, stating that he remains active and participates in weekly ecosystem calls. His Slack profile, which sources said had been temporarily deactivated, appeared to be reinstated recently.

As such, the latest development involving his suspension speaks to the depth of the matter, likely amid new findings in the third-party investigation.

Questions remain regarding the liquidity partner vetting and, inadvertently, the future of the Movement ecosystem. They also highlight concerns about internal controls at Movement Labs.

“How about Sam Thapaliya?” The Block co-founder Mike Dudas chipped in.

Thapaliya, the founder of Zebec Protocol, has known Movement Labs co-founders Rushi Manche and Cooper Scanlon since college. He advised Movement Labs, particularly around the launch of their MOVE token, including assisting with curating the airdrop whitelist.

His role was subject to scrutiny following a controversial market-making agreement with Rentech, which led to a $38 million token sell-off scandal in December 2024. Speculation suggests that Thapaliya was included in key emails regarding the Rentech deal.

There is also speculation that his influence as a “shadow third co-founder” shaped last-minute decisions. However, Thapaliya has maintained that he had no formal role, equity, tokens, or decision-making power in Movement Labs or the Movement Foundation.

Rushi Manche To Provide Clarity

While he is yet to address recent developments involving his suspension, Manche recently vowed to provide clarity.

“…lots of rumors circulating and internal drama. I am excited to start clearing stuff up, reveal the story, and clear my name, starting with this article,” he stated.

In the lengthy post, Manche claimed “opportunistic administrators” acting as shadow decision-makers within the foundation misled the team.

“These same representatives are the ones who broker deals, run financial treasuries, make hires, and ‘negotiate deals’ behind the center while letting others take the blame,” he added.

Urging founders to work with reputable firms that do not run their agendas, Manche articulated that the Movement had veered far from the original vision.

It remains unclear whether this exposé led to his suspension, as Manche did not immediately respond to BeInCrypto’s request for comment. However, following his remarks, the MOVE airdrop (Movedrop), which was supposed to take place on April 30, was postponed.

“Movedrop delayed again, what a clown show. The worst thing was being announced the same day it was supposed to happen—not professional, not respectful. MOVE is a real disappointment,” one user observed.

As the Movement Network’s credibility and reputation continue to be questioned, the MOVE token has decreased by almost 22% in the last 24 hours. As of press time, it has seen a steeper crash following the Coinbase delisting announcement to trade for $0.20.