Defiance Capital Founder Claims Crypto Prices Are Being Manipulated

Arthur Cheong, founder of Defiance Capital, has raised concerns over alleged market manipulation within the crypto industry by projects and market makers.

He accused them of artificially sustaining token prices while centralized exchanges (CEXs) turn a blind eye.

Cheong Warns Market Is Becoming ‘Uninvestable’

In an April 14 post on X, Cheong claimed that the liquid crypto market is plagued by a “complete black box” system in which the involved parties collaborate to engineer token valuations.

“You don’t know whether the price is a result of organic demand and supply,” he wrote, “or simply due to projects and market makers colluding to fix the price to achieve other objectives.”

Cheong also criticized the CEXs, suggesting they are deliberately ignoring these practices despite their damaging impact. He noted that the altcoin market is increasingly resembling a “lemon’s market,” where reduced trust makes quality harder to identify.

He further argued that token generation events (TGEs) in 2025 have been poorly priced, with many coins dropping between 70% and 90% within months of listing, leaving buyers facing major losses.

The Defiance Capital CIO concluded by emphasizing that unless major players in the crypto space take action to fix these issues, many parts of the market will remain unsafe for serious investors in the future.

MANTRA Crash Sparks Manipulation Fears

His comments follow the April 13 collapse of MANTRA’s native token, OM, which saw its market value nosedive by 90% in a matter of hours. John Patrick Mullin, a co-founder of the protocol, claimed the crash was caused by forced liquidations carried out by CEXs.

However, blockchain data revealed unusual activity in the days leading up to the incident. Analytics platform Lookonchain reported that 17 wallets sent 43.6 million OM tokens, about 4.5% of all coins in circulation, to exchanges starting on April 7. Two of those wallets were linked to Laser Digital, a known investor in MANTRA, raising suspicions of insider selling.

Meanwhile, Spot On Chain said whale OM holders moved 14.27 million tokens to OKX three days before the crash. Further, they had bought over 84 million OM for $564.7 million in March, which added to fears of a planned sell-off.

Earlier in the year, the Libra token faced similar scrutiny. Following Argentinian President Javier Milei’s public endorsement,  the coin’s market cap surged to $4 billion within hours before crashing by over 90%, wiping out millions in investor funds.

The country’s Chamber of Deputies has since approved an investigation into LIBRA, focusing on Milei’s social media promotion of the meme coin and its subsequent collapse.