Neiro, an Ethereum-based memecoin project, has cut ties with market-making partner Gotbit following allegations of market manipulation.
The decision follows a U.S. Securities and Exchange Commission (SEC) investigation into Gotbit’s involvement in fraudulent trading practices. neiro’s move to distance itself from Gotbit has sparked broader concerns over partnerships in the crypto industry.
Neiro ends collaboration with Gotbit
Neiro officially announced the termination of its partnership with Gotbit on October 11, shortly after the SEC charged Gotbit and several other market makers with manipulation and wash trading. In a public statement, Neiro emphasized that none of Gotbit’s alleged wrongdoings involved their project. However, the company believed ending the partnership was the right step for the project and its community. Neiro also assured its users that it had withdrawn a portion of the funds held by Gotbit, with the company’s CTO set to use personal funds for interim market-making operations until new partners are secured.
The firm expressed optimism that the project would emerge more assertive, with plans to onboard new market makers shortly. Despite this, some in the crypto community, including well-known blockchain investigator ZachXBT, have criticized Neiro for partnering with Gotbit in the first place.
ZachXBT criticizes Neiro for its partnership with Gotbit
ZachXBT, a vocal critic of shady market practices in the crypto space, pointed out that Neiro had been aware of Gotbit’s questionable reputation before forming the partnership. According to ZachXBT, Neiro had acknowledged hearing “shady stuff” about Gotbit in a public post on August 6. He further highlighted that a concerned holder had warned Neiro on August 7, urging the project to avoid working with Gotbit.
ZachXBT has also called on Neiro to explain to its community why it moved forward with Gotbit despite the market maker’s alleged involvement in pump-and-dump schemes. Even before the SEC charges, ZachXBT had raised concerns about Gotbit’s credibility, citing a leaked report that suggested Gotbit’s involvement in manipulating token prices to create fear of missing out (FOMO) among investors.
Other meme coin projects several tries with Gotbit
Neiro is one of many projects that have distanced themselves from Gotbit. Other meme coin projects, like Tron’s BMS and BEER, have also terminated their partnerships with the market maker. BMS stated that while they had initially hoped for a successful collaboration, they could not continue working with an entity facing SEC charges. The project claimed that Gotbit held a significant portion of its supply tokens and refused to return them.
BEER, another meme coin project, has similarly parted ways with Gotbit and secured a new market-making partner. These developments signal a growing unease among crypto projects regarding partnerships with market makers facing legal scrutiny.
Concerns about transparency and ethical collaboration in the crypto space continue to grow as more projects reassess their partnerships in light of ongoing investigations into fraudulent market practices.