Movement Labs Fires Co-Founder after Token Dump
Blockchain startup rebranded itself after market-maker controversy triggered exchange delisting.
Movement Labs has terminated co-founder Rushi Manche following revelations of a controversial agreement that allowed a market maker to dump tokens worth $38 million just 24 hours after the project's launch.
The blockchain startup, which raised $38 million in venture funding and was backed by World Liberty Financial, announced on May 7 that it would rebrand as "Move Industries" as it attempts to distance itself from the growing scandal.
Movement Labs was founded by Manche and Cooper Scanlon, Vanderbilt University dropouts who aimed to build a blockchain platform leveraging Facebook's Move programming language to create a scalable Layer 2 solution for Ethereum.
At the heart of the controversy is a complex arrangement between Movement Foundation and Web3Port, a Chinese market maker, brokered through a mysterious middleman called Rentech.
An investigation by CoinDesk revealed that Movement Foundation loaned approximately half of MOVE's publicly circulating supply to Rentech, a company with "zero digital footprint" that appeared to represent both sides of the transaction, acting as both an agent of Movement Foundation and as a Web3Port subsidiary.
The contract contained a clause allowing the market maker to liquidate tokens once MOVE hit a $5 billion valuation, splitting profits 50-50 with the foundation.
Crypto expert Zaki Manian described this as creating "incentives basically to manipulate the price to over $5 billion fully diluted value and then dump on retail for shared profit."
Movement's general counsel, YK Pek, initially flagged the proposal as "possibly the worst agreement I have ever seen," yet a revised version with similar core provisions was eventually approved.
The consequences of the token dump have been severe
Binance banned Web3Port for "misconduct" and froze funds
Coinbase announced plans to delist MOVE on May 15, citing failure to meet listing standards
Token was placed in limit-only trading mode on some exchanges
Anticipated MoveDrop token airdrop has been indefinitely delayed
MOVE token value declined 38% in the past week alone.
Manche was the one who initially forwarded the Rentech deal to the Movement Foundation and championed it internally, the CoinDesk investigation said. He was placed on administrative leave in mid-April 2025 as the investigation began, formally suspended on May 2, and terminated on May 7.
Following Manche's termination, Movement Labs announced a comprehensive restructuring
Formation of Move Industries, established by two Movement employees
Appointment of Torab Torabi, a founding member, as CEO
Will Gaines becoming President and Chief Marketing Officer
Young Yang Liauw continuing to oversee engineering, bringing expertise from Aptos, Novi, and Meta's Libra team
Co-founder Cooper Scanlon has voluntarily stepped down, passing leadership to Torabi while expressing confidence in the new direction.
"It has been an incredible journey bringing the Movement vision to life and I'm immensely proud of what we've built together, Torab has been instrumental to Movement's development from the beginning” said Scanlon.
Move Industries has promised "enhanced accountability measures" including expanded board oversight and transparent decision-making processes, with three core focus areas: Community/Brand, Engineering/Product, and Ecosystem/Business Development.