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The cryptocurrency space has come under fire once more as the token $LAB is investigated after a massive 3,700% price spike in a single month.

A rapid appreciation is usually enough to attract speculation, however, the fundamentals paint an entirely different and much more damning picture.

This led to an abnormally centralized token distribution with approximately 95% of the token supply sitting with team and insiders, according to reports. Such a level of concentration also immediately raises concerns over possible price manipulation. In a decentralized market landscape, however, this unequal distribution of supply carries with it an increased potential for coordination, especially when combined with sudden price spikes.

The case has spiraled out of control so much in fact, that on-chain investigator ZachXBT is put a $10,000 bounty for legitimate tips to help identify those behind the actions.

$10K bounty is now live on @vsadkovv passport/ID or insider details of the market maker (contracts, chat logs, etc) used for LAB on Bitget spot, Bybit perps Binance perps, or OKX perps.

These grifters are further hurting the industry reputation and it must not go unpunished.… pic.twitter.com/NG2n2PHWeS

— ZachXBT (@zachxbt) May 7, 2026

The move highlights rising frustration in the crypto community to learn what many suspect is a planned effort to game the markets.

Investigation shows that more granular analysis of abnormal wallet behavior is directly attributable to the LAB team. Several reports reveal that those wallets associated with insiders are among the main actors of liquidity supply and price dynamics.

One of the most eye-catching trades was that on April 8, when a wallet linked to the team tagged with 0xe037 deposited 40 million LAB tokens worth around $13.6 million to centralized exchange Bitget. The great size and timing of this transfer raised alarm bells straight away.

Digging deeper informs us that only days before the announced price increase on May 1, more wallets affiliated with the team transferred 96 million LAB tokens worth $63 million to Bitget. Large size transfers just prior to an important price pump are indicative of market manipulation by pre-positioning.

The patterns closely represent old school pump-and-dump schemes where those on the inside scoop build or hoard a massive supply, manipulate demand and then dump their bags onto retail investors while they are at the height of hype.

The LAB incident is not an isolated case. According to the report from Specter Analyst, it appears CEXs might be enabling these cycles either accidentally or intentionally by providing liquidity and trading infrastructure without sufficient scrutiny.

Price manipulation now happens almost every week, with $LAB by @LABtrade_ becoming the latest pump-and-dump token while Bitget continues playing the usual CEX role.

The LAB team, @vsadkovv, appears to control a significant portion of the supply. Wallets linked to the team still… pic.twitter.com/O7MnoQBkgL

— Specter (@SpecterAnalyst) May 7, 2026

For example, in the LAB case, Bitget has been mentioned as a main place of trading volume. Critics argue that exchanges profit from fatter volumes via fees, and hence have an interest in not having to rigorously enforce suspicious behaviours.

These worries reach beyond Bitget, with high-volume exchanges for perpetual futures markets possibly allowing speculative manipulation.

Anger among members of the cryptocurrency community over stark lack of clarity is rising. Bitget CEO Gracy, also previously confirmed “an investigation that is still ongoing” about related matters, like the RAVE case, but weeks later comments were made public.

This silence, in turn, breeds uncertainty among investors and analysts. Trust in centralized exchanges erodes without uniform disclosures or transparent enforcement of those disclosures. The absence of accountability raises an existential question for various stakeholders, namely, who is responsible for ensuring market integrity?

ZachXBT had urged the company heads to address it publicly as well, writing that this kind of transparency was essential and should also be followed up with real action.

Hello Gracy.

The community has not received any update about the investigation of RAVE.

While now LAB is running yet another market manipulation scheme via Bitget spot.

Every new token running similar scams only hurts the credibility of the industry further.

Yes CEXs want… https://t.co/4BZQvIlqAJ

— ZachXBT (@zachxbt) May 7, 2026

The continued lack of immediate updates not only sullies the exchange’s reputation but also increases uncertainty throughout the market.

In addition to exchange deposits; on-chain data indicates aggressive accumulation and distribution of LAB tokens. Some wallets have purchased LAB on-chain and moved this into exchanges like Gate and Bitget.

Of particular interest, these wallets also exhibit activity in other tokens such as are currently trading at over 1,000%, after a movement of more than 30 days. These cross-token movements hint at some sort of organized behavior across multiple projects.

When you see patterns like these, they are either organized trading groups working with artificial intelligence or insiders trying to liquidate as many assets as possible down the line. These actors rotate capital through tokens, playcarding one title after another to generate hype cycles in strongly correlated form whilst extracting value from retail users.

Because of that repetitiveness, it becomes a societal problem versus individual events.

This can have consequences far beyond a single token or exchange as illustrated by the LAB episode. Every manipulation case which goes undetected damages the credibility of the entire cryptocurrency sector.

Even retail actors, who are often entering in a cast-19-affected market with limited data and modelling tools, are most susceptible. Sudden price pumps and dumps not only provide massive losses but also cut out from the game reducing the long confidence in general.

This leads to a growing tension between revenue generation and market integrity. The exchanges gain from high-volume trading in fees, but if those volumes are more manipulation than commerce, the long term harm done could be extensive.

When institutions fail to respond in a timely manner, citizens are stepping up. The $10k bounty ZacksXBT offers is the perfect example of an emerging trend where independent investigators and analysts operate as unofficial watchdogs in the crypto ecosystem.

The bounty pledges a reward for whistleblowers and sources of information, all in the name of tracking down those responsible for running LAB work. This type of thing is part of a larger trend toward decentralised accountability, where community-instituted transparency takes precedence over institutional authority.

However, these attempts also reveal the contradictions of the present order. The idea is that exchanges and regulators would take the initiative to detect and prevent manipulation to the greatest extent possible, eliminating reliance on third parties.

The new LAB scandal comes at an important time in the history of the crypto industry. With increased adoption comes the need for comprehensive protections designed to protect participants and create a level playing field in the market.

Erosion of confidence in the ecosystem is likely to continue until platforms make an effort to investigate suspicious activities, expose coordinated manipulation and provide updates with transparency. In contrast, strong and transparent action could help rebuild trust and establish clear standards of accountability.

For the moment, focus is trained on the ongoing investigation, and whether the industry can rise to meet one of its biggest challenges.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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