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Crypto Market Maker Deals: How They Work and the Red Flags to Spot

Every token launch needs a crypto market maker, and the deal you sign shapes your chart for a year. Here is how loan and option deals work, what the US cases against Gotbit and others revealed, and the red flags to check before you sign.

By Sparx, Growth research team··8 min read

Key takeaways

  • Most market-making deals for new tokens follow one of two models. In a retainer, the project pays a monthly fee. In a loan and call option deal, the project lends tokens and the market maker gets the right to buy them later at a set price, which can reward it for pushing the price up and then selling.

  • US authorities have treated fake volume as fraud. In October 2024 the SEC charged ZM Quant, Gotbit and CLS Global with selling what it called "market-manipulation-as-a-service", and in June 2025 Gotbit's founder was sentenced to eight months in prison.

  • Disclosure is becoming the standard for serious launches. For Monad's sale, Coinbase published every market maker, loan size and term, with a third party checking how the tokens were used.

A crypto market maker is a trading firm that keeps buy and sell orders on exchanges so that a token can be traded without wild price jumps. Almost every project that lists a token signs one, and many founders sign without fully understanding the terms. That is a problem, because the market-making deal decides who holds a large block of your supply in the first months after launch and what they are paid to do with it.

At AnkhLabs we work on launches, not trading, but the two meet on the price chart. A thin or manipulated market can undo months of community work in a week, and the first question a holder asks when the price falls is who sold. This guide explains how market-making deals work, what the public enforcement cases revealed and what to check before you sign. It builds on our guides to token launch strategy and exchange listing strategy.

What does a crypto market maker do?

A market maker places orders on both sides of the order book, offering to buy slightly below the current price and to sell slightly above it. The gap between the two is called the spread. The total value of orders near the current price is called depth. Tight spreads and good depth mean a buyer can purchase a reasonable amount without moving the price much, which is what exchanges, funds and ordinary holders all want.

Exchanges often expect a project to have a market maker before they list it. The market maker needs both cash and tokens to quote on both sides, and that is where the deal structure comes in. Where the tokens come from, and what the market maker may do with them, is the whole game.

How do market maker deals work for token launches?

There are two common models, and Cointelegraph's investigation of market maker deals sets out the difference clearly.

  • The retainer model. The project pays a flat monthly fee for defined services such as a maximum spread, a minimum depth and hours of uptime. It costs more in the short term, but the market maker earns from doing the job, not from where the price goes.

  • The loan and call option model. The project lends tokens to the market maker, often for a year, and the market maker gets a call option, which is the right to buy those tokens at a pre-agreed price when the deal ends. If the price rises, the market maker can exercise the option, buy at the low price and sell at the high one. If the price falls, it simply returns whatever tokens remain.

The second model looks cheap because no fee is paid upfront. The cost is hidden in the option. DL News described it as the most common market-making deal in crypto and quoted the Acheron Trading founder Pryor saying most "parasitic" market making happens under these deals. The incentive is plain. A firm holding a large loan and an option profits most if the price spikes early and it sells into that spike.

That does not mean every loan deal is abusive. Wintermute's chief executive Evgeny Gaevoy told DL News that disclosure is "generally a great development" while arguing that market makers have a right to operate privately as long as they avoid manipulation. The point for a founder is that the structure creates incentives, and incentives need limits written into the contract.

What the enforcement cases revealed

The clearest public picture of market-making abuse came from the United States. On 9 October 2024 the SEC charged three firms it described as purported market makers along with promoters and employees. The firms were ZM Quant, Gotbit and CLS Global. The SEC alleged the firms sold "market-manipulation-as-a-service", using wash trading, which means trading with yourself to fake volume, and bots that generated billions of dollars in artificial daily volume. It also alleged that ZM Quant and CLS Global manipulated a token created at the direction of the FBI as part of a parallel criminal investigation.

The criminal case against Gotbit ended in a plea. According to The Block, the founder Aleksei Andriunin was sentenced on 13 June 2025 to eight months in prison and a year of supervised release, and the firm received five years of probation, during which prosecutors said it would cease operations. Prosecutors said Gotbit "provided market manipulation services to create artificial trading volume for multiple cryptocurrency companies" and that its staff "marketed these wash trading tactics to prospective clients."

That last detail matters for founders. The firms were not hacking anyone. They were selling a service, fake volume, to projects that wanted to look bigger than they were. Projects that buy that service are part of the problem, not its victims.

The MOVE case and loan deals gone wrong

The Movement Labs episode showed what can happen inside a loan deal. In March 2025 Binance suspended a market maker linked to the MOVE token after it sold about 66 million MOVE shortly after listing and made about 38 million USDT, according to ForkLog's report, which said Binance froze the funds. On-chain researcher ZachXBT reportedly identified the firm as Web3Port.

The fallout was severe. On 7 May 2025 Movement Labs said it had terminated its co-founder Rushi Manche, who Cointelegraph reported had brokered the deal through an intermediary, and Coinbase suspended trading in MOVE, citing its listing standards. Crypto Briefing later noted that leaked documents exposed no illegal conduct but showed the terms were as one-sided as many had suspected.

Outside the Gotbit plea, these are allegations and reports rather than court findings. They are still the best public evidence of how a deal signed in a hurry before listing can become the main story of a project's year.

What does a transparent deal look like?

Monad's token sale on Coinbase in November 2025 set a useful benchmark. Before the sale, Coinbase published the full market-making setup. According to crypto.news, five firms borrowed a total of 160 million MON, worth about $4 million at the sale price. CyantArb borrowed 50 million and three others borrowed 30 million each, all for one month. Those three were Auros, Galaxy and GSR. Wintermute borrowed 20 million for up to a year. Coinwatch, a third-party monitor, was hired to verify how the tokens were used and to track idle balances.

The disclosure did three useful things. It showed holders the scale of the loans relative to supply, it put short durations on most of them and it added an outside check. Calls for this to become normal are growing. Crypto Briefing reported in July 2026 that an op-ed in Newsweek on 10 June 2026 argued projects should be required to publish their market-making terms, and that the exchange Bullish favours performance-based fees tied to spreads and uptime over token loans.

Red flags in a crypto market maker deal

Before you sign, check for these warning signs.

  • Promises of volume or rankings. Any offer to make your token look busier than it is, or to push it up data-site rankings, is a request to buy wash trading. The SEC and DOJ cases show how that can end.

  • Large loans with long options. Crypto Briefing gives the example of a loan of 5% of circulating supply with a call option as information holders would treat as material. A big loan, a long term and a low strike price together create the strongest incentive to sell into early demand.

  • No measurable duties. A good contract states the maximum spread, minimum depth on each exchange and required uptime, with reporting you can check.

  • No exit. You should be able to end the deal for underperformance. Coinwatch's chief executive Matt Jobbe-Duval told DL News he recommends easier termination and more transparent reporting.

  • Too many secrets. If the firm will not let you disclose the main terms to your community, ask why.

  • Deals brokered by middlemen. The MOVE case ran through an intermediary. Sign directly with the firm that trades, and know who controls the tokens.

Why market maker deals matter to marketing

Founders often treat market making as a finance task and marketing as a separate job. In practice the chart is part of the message. If a market maker dumps into your launch, every post, campaign and creator video from that week is remembered as the moment people bought the top. Our piece on TGE marketing plans covers how to sequence that launch week.

Fake volume causes a slower kind of damage. It may lift a token on ranking sites for a while, but traders spot books that are busy and shallow, and once a project is linked to wash trading the reputational cost outlasts any listing. Real demand comes from people who understand the product and want to hold it.

Disclosure is also a communication opportunity. A short, plain post that names your market makers, the loan sizes and what they are paid to do builds more trust than a vague promise of "deep liquidity". It also gives you something solid to point to when the price drops, as it will at some point, and it sits well alongside honest messaging about token buybacks and supply.

What we'd tell a founder signing a market maker

First, decide what you are buying. You want tight spreads and real depth on the exchanges where your holders trade, not volume. Put those numbers in the contract and check them weekly.

Second, keep loans small and short, and plan to publish the terms. If a firm will only work with a large, long option, compare it against a retainer quote before you decide the option is cheap.

Third, let real attention do the work that fake volume pretends to do. For the OKX Alpha public sale, KOL distribution supported a $500K close, with creators selected on trading credibility and audience quality rather than follower count. More examples are in our case studies, and our strategic advisory work covers launch planning around partners like these.

If you are about to sign a market-making deal and want a second opinion on how it fits your launch, talk to AnkhLabs.

The bottom line

A crypto market maker is a necessary partner for most token launches, and most are legitimate businesses. The risk sits in the contract. Loans with options can quietly put a seller against your community, and anything that sells volume rather than liquidity is a liability. Read the terms, keep them short, publish them, and judge the firm by spreads and depth rather than by the activity on your chart.

This article is for information only and is not legal or investment advice. Descriptions of enforcement actions and disputes reflect the cited reports and filings. Figures are as of October 2026 unless stated.



← Articles

Crypto Market Maker Deals: How They Work and the Red Flags to Spot

Every token launch needs a crypto market maker, and the deal you sign shapes your chart for a year. Here is how loan and option deals work, what the US cases against Gotbit and others revealed, and the red flags to check before you sign.

By Sparx, Growth research team··8 min read

Key takeaways

  • Most market-making deals for new tokens follow one of two models. In a retainer, the project pays a monthly fee. In a loan and call option deal, the project lends tokens and the market maker gets the right to buy them later at a set price, which can reward it for pushing the price up and then selling.

  • US authorities have treated fake volume as fraud. In October 2024 the SEC charged ZM Quant, Gotbit and CLS Global with selling what it called "market-manipulation-as-a-service", and in June 2025 Gotbit's founder was sentenced to eight months in prison.

  • Disclosure is becoming the standard for serious launches. For Monad's sale, Coinbase published every market maker, loan size and term, with a third party checking how the tokens were used.

A crypto market maker is a trading firm that keeps buy and sell orders on exchanges so that a token can be traded without wild price jumps. Almost every project that lists a token signs one, and many founders sign without fully understanding the terms. That is a problem, because the market-making deal decides who holds a large block of your supply in the first months after launch and what they are paid to do with it.

At AnkhLabs we work on launches, not trading, but the two meet on the price chart. A thin or manipulated market can undo months of community work in a week, and the first question a holder asks when the price falls is who sold. This guide explains how market-making deals work, what the public enforcement cases revealed and what to check before you sign. It builds on our guides to token launch strategy and exchange listing strategy.

What does a crypto market maker do?

A market maker places orders on both sides of the order book, offering to buy slightly below the current price and to sell slightly above it. The gap between the two is called the spread. The total value of orders near the current price is called depth. Tight spreads and good depth mean a buyer can purchase a reasonable amount without moving the price much, which is what exchanges, funds and ordinary holders all want.

Exchanges often expect a project to have a market maker before they list it. The market maker needs both cash and tokens to quote on both sides, and that is where the deal structure comes in. Where the tokens come from, and what the market maker may do with them, is the whole game.

How do market maker deals work for token launches?

There are two common models, and Cointelegraph's investigation of market maker deals sets out the difference clearly.

  • The retainer model. The project pays a flat monthly fee for defined services such as a maximum spread, a minimum depth and hours of uptime. It costs more in the short term, but the market maker earns from doing the job, not from where the price goes.

  • The loan and call option model. The project lends tokens to the market maker, often for a year, and the market maker gets a call option, which is the right to buy those tokens at a pre-agreed price when the deal ends. If the price rises, the market maker can exercise the option, buy at the low price and sell at the high one. If the price falls, it simply returns whatever tokens remain.

The second model looks cheap because no fee is paid upfront. The cost is hidden in the option. DL News described it as the most common market-making deal in crypto and quoted the Acheron Trading founder Pryor saying most "parasitic" market making happens under these deals. The incentive is plain. A firm holding a large loan and an option profits most if the price spikes early and it sells into that spike.

That does not mean every loan deal is abusive. Wintermute's chief executive Evgeny Gaevoy told DL News that disclosure is "generally a great development" while arguing that market makers have a right to operate privately as long as they avoid manipulation. The point for a founder is that the structure creates incentives, and incentives need limits written into the contract.

What the enforcement cases revealed

The clearest public picture of market-making abuse came from the United States. On 9 October 2024 the SEC charged three firms it described as purported market makers along with promoters and employees. The firms were ZM Quant, Gotbit and CLS Global. The SEC alleged the firms sold "market-manipulation-as-a-service", using wash trading, which means trading with yourself to fake volume, and bots that generated billions of dollars in artificial daily volume. It also alleged that ZM Quant and CLS Global manipulated a token created at the direction of the FBI as part of a parallel criminal investigation.

The criminal case against Gotbit ended in a plea. According to The Block, the founder Aleksei Andriunin was sentenced on 13 June 2025 to eight months in prison and a year of supervised release, and the firm received five years of probation, during which prosecutors said it would cease operations. Prosecutors said Gotbit "provided market manipulation services to create artificial trading volume for multiple cryptocurrency companies" and that its staff "marketed these wash trading tactics to prospective clients."

That last detail matters for founders. The firms were not hacking anyone. They were selling a service, fake volume, to projects that wanted to look bigger than they were. Projects that buy that service are part of the problem, not its victims.

The MOVE case and loan deals gone wrong

The Movement Labs episode showed what can happen inside a loan deal. In March 2025 Binance suspended a market maker linked to the MOVE token after it sold about 66 million MOVE shortly after listing and made about 38 million USDT, according to ForkLog's report, which said Binance froze the funds. On-chain researcher ZachXBT reportedly identified the firm as Web3Port.

The fallout was severe. On 7 May 2025 Movement Labs said it had terminated its co-founder Rushi Manche, who Cointelegraph reported had brokered the deal through an intermediary, and Coinbase suspended trading in MOVE, citing its listing standards. Crypto Briefing later noted that leaked documents exposed no illegal conduct but showed the terms were as one-sided as many had suspected.

Outside the Gotbit plea, these are allegations and reports rather than court findings. They are still the best public evidence of how a deal signed in a hurry before listing can become the main story of a project's year.

What does a transparent deal look like?

Monad's token sale on Coinbase in November 2025 set a useful benchmark. Before the sale, Coinbase published the full market-making setup. According to crypto.news, five firms borrowed a total of 160 million MON, worth about $4 million at the sale price. CyantArb borrowed 50 million and three others borrowed 30 million each, all for one month. Those three were Auros, Galaxy and GSR. Wintermute borrowed 20 million for up to a year. Coinwatch, a third-party monitor, was hired to verify how the tokens were used and to track idle balances.

The disclosure did three useful things. It showed holders the scale of the loans relative to supply, it put short durations on most of them and it added an outside check. Calls for this to become normal are growing. Crypto Briefing reported in July 2026 that an op-ed in Newsweek on 10 June 2026 argued projects should be required to publish their market-making terms, and that the exchange Bullish favours performance-based fees tied to spreads and uptime over token loans.

Red flags in a crypto market maker deal

Before you sign, check for these warning signs.

  • Promises of volume or rankings. Any offer to make your token look busier than it is, or to push it up data-site rankings, is a request to buy wash trading. The SEC and DOJ cases show how that can end.

  • Large loans with long options. Crypto Briefing gives the example of a loan of 5% of circulating supply with a call option as information holders would treat as material. A big loan, a long term and a low strike price together create the strongest incentive to sell into early demand.

  • No measurable duties. A good contract states the maximum spread, minimum depth on each exchange and required uptime, with reporting you can check.

  • No exit. You should be able to end the deal for underperformance. Coinwatch's chief executive Matt Jobbe-Duval told DL News he recommends easier termination and more transparent reporting.

  • Too many secrets. If the firm will not let you disclose the main terms to your community, ask why.

  • Deals brokered by middlemen. The MOVE case ran through an intermediary. Sign directly with the firm that trades, and know who controls the tokens.

Why market maker deals matter to marketing

Founders often treat market making as a finance task and marketing as a separate job. In practice the chart is part of the message. If a market maker dumps into your launch, every post, campaign and creator video from that week is remembered as the moment people bought the top. Our piece on TGE marketing plans covers how to sequence that launch week.

Fake volume causes a slower kind of damage. It may lift a token on ranking sites for a while, but traders spot books that are busy and shallow, and once a project is linked to wash trading the reputational cost outlasts any listing. Real demand comes from people who understand the product and want to hold it.

Disclosure is also a communication opportunity. A short, plain post that names your market makers, the loan sizes and what they are paid to do builds more trust than a vague promise of "deep liquidity". It also gives you something solid to point to when the price drops, as it will at some point, and it sits well alongside honest messaging about token buybacks and supply.

What we'd tell a founder signing a market maker

First, decide what you are buying. You want tight spreads and real depth on the exchanges where your holders trade, not volume. Put those numbers in the contract and check them weekly.

Second, keep loans small and short, and plan to publish the terms. If a firm will only work with a large, long option, compare it against a retainer quote before you decide the option is cheap.

Third, let real attention do the work that fake volume pretends to do. For the OKX Alpha public sale, KOL distribution supported a $500K close, with creators selected on trading credibility and audience quality rather than follower count. More examples are in our case studies, and our strategic advisory work covers launch planning around partners like these.

If you are about to sign a market-making deal and want a second opinion on how it fits your launch, talk to AnkhLabs.

The bottom line

A crypto market maker is a necessary partner for most token launches, and most are legitimate businesses. The risk sits in the contract. Loans with options can quietly put a seller against your community, and anything that sells volume rather than liquidity is a liability. Read the terms, keep them short, publish them, and judge the firm by spreads and depth rather than by the activity on your chart.

This article is for information only and is not legal or investment advice. Descriptions of enforcement actions and disputes reflect the cited reports and filings. Figures are as of October 2026 unless stated.