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Gate.io Accused of Manipulating RATS Token Prices, Sparking Community Outcry

The cryptocurrency sphere has been rife with controversy as the RATS project, a meme coin adhering to the BRC-20 token standard on the Bitcoin network, has rallied its community against the Gate.io exchange. Allegations of the exchange holding a substantial amount of RATS tokens and engaging in manipulative practices to control prices have triggered a call to boycott Gate.io and withdraw assets from its platform.

The RATS project accuses Gate.io of intentionally manipulating the displayed data for RATS tokens, creating discrepancies in trading volumes to facilitate profit-taking. The community, led by the RATS token adherents, has strongly criticized Gate.io for what they claim are fake spot transactions.

Wu Blockchain, a reputable source, corroborates the community’s stance by stating, “The BRC20 token RATS community is launching a boycott movement against the Gate exchange. They criticized Gate for having fake spot transactions.” Evidence provided suggests that between 21:00 and 23:00 UTC+8 on December 4, the trading volume of RATS tokens on Gate.io surpassed 880 billion, while the total supply of RATS tokens stands at 1 trillion. This data has fueled suspicions of market manipulation.

Moreover, users such as @VT_BNB have highlighted a significant drop in investment portfolios on Gate.io, especially those comprising BRC-20 tokens like RATS, ORDI, SATS, among others, during a period when the broader market was enthusiastic about Bitcoin breaching the $40,000 mark after 19 months. @VT_BNB alleges that Gate.io took advantage of a 1.12% decline in BTC to unload a substantial amount of RATS tokens, causing a rapid decline in their value. At the time of profit-taking, Gate.io reportedly held 10% of the RATS token supply and consistently executed sell orders, inflating the trading volume to 984.7 billion.

Despite these accusations, both @VT_BNB and the RATS project’s accounts have been inexplicably blocked by @gate_io’s official communication channels without providing any reasons or responses.

Gate.io, however, has defended itself, attributing the surge in trading volume on the evening of December 4 to market volatility and varied trading strategies employed by several high-volume users. The exchange has distanced itself from any involvement in manipulating token prices, attributing the situation to the dynamics of the market.

The BRC-20 token standard, introduced through the Bitcoin Ordinals protocol in January 2023 following the Taproot upgrade, has streamlined token deployment, minting, and transfers among users on the Bitcoin network.

Previously, there have been instances where BRC-20 tokens on the Bitcoin network reached billion-dollar market caps, contributing to spiking Bitcoin transaction fees and network congestion, prompting Binance to halt withdrawals multiple times.

Update

In response to accusations of manipulating RATS token prices, Gate.io has asserted its commitment to safeguarding user assets. Emphasizing their role as a leading global entity in this domain, Gate.io has underscored the paramount importance of ensuring the security of assets within their ecosystem.

To substantiate their commitment, Gate.io released a 100% proof of reserve snapshot for several leading BRC20 projects, conducted on December 5, 2023, at 10:00 AM. This transparent snapshot, available for scrutiny on their platform, reveals reassuring details regarding the reserve ratios of prominent assets like ORDI, SATS, RATS, among others. Impressively, the proof of reserve ratios for these assets has surpassed the 100% mark, instilling confidence within the community about the solidity of these reserves. Notably, Bitcoin (BTC) has demonstrated an impressive proof of reserve ratio, standing at an impressive 120%, further reinforcing Gate.io’s commitment to transparency and security within its trading infrastructure.

The latest snapshot results shared by Gate.io have highlighted the robustness of their reserve ratios, showcasing an exceeding level of reserves for various assets, which could potentially assuage concerns raised within the community regarding the alleged manipulation of RATS token prices. The provided proof of reserve snapshot serves as a pivotal step toward fostering trust and transparency among Gate.io’s user base and the wider cryptocurrency community.

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