Trove Markets Accused of $10 Million HYPE Token Dump Amid Fraud Concerns

Trove Markets is facing mounting scrutiny after allegedly dumping over $10 million in $HYPE tokens within a 24-hour period. The Web3 decentralized perpetual exchange is built on Hyperliquid’s HIP-3 protocol. These tokens, originally acquired for staking to launch the DEX, were sold from a wallet linked to the project, raising suspicions of insider manipulation and undermining community trust. Hyperliquid Foundation enlisted ZachXBT as HYPE price fell 60% below ICO levels. Trove Markets initially liquidated $5 million in tokens, with total sales reaching 194,273 HYPE tokens, equivalent to roughly $10 million, within a single day. > They increased to $10 million in dumping in 24 hours.[https://t.co/tvm9rAqiiq](https://t.co/tvm9rAqiiq) > [pic.twitter.com/kLZ5tN2Oky](https://t.co/kLZ5tN2Oky) > > — Hyperliquid News (@HyperliquidNews) [January 18, 2026](https://twitter.com/HyperliquidNews/status/2012939280914477072?ref_src=twsrc%5Etfw) Complicating the situation, Trove’s founder publicly denied control over the wallet and requested its shutdown. Still, the wallet resumed sales minutes later. > “A few minutes after the founder of @TroveMarkets said that he does not control the wallet, and that he is asking for the wallet to be shut down, it starts selling again, reaching 194,272.79 $HYPE in 24 hours,” Hyperliquid News [reported](https://x.com/HyperliquidNews/status/2012936943936385475?s=20) > . The rapid continuation of sales fueled speculation of either insider fraud or compromised wallet access, intensifying community concern. Hyperliquid Foundation Engages ZachXBT to Investigate This controversy adds to existing criticism surrounding Trove Markets’ ICO. The offering was extended at the last minute and oversubscribed, ultimately raising $11.9 million at a fully diluted valuation of $20 million. Confusion over the ICO reportedly led to losses of around $73,000 for Polymarket prediction market users. Reports also emerged that the project paid influencers $5,000 per month to promote the token while allegedly concealing team members’ Iranian origins, raising further transparency concerns. Community members, including NMTD8, also flagged Trove’s investment in the controversial XMR1 project and the delay in staking the HYPE tokens. > Previously spoke out against Trove. > > They then bought XMR1 with the funds from selling HYPE. > > XMR1 is also extremely shady. > > Beware of those trying to extract from HL. > > If Trove had good intentions, they would have staked the 500K HYPE to be ready for HIP-3 deployments by now… [https://t.co/RLfOeFCuYj](https://t.co/RLfOeFCuYj) > > — NMTD.HL (@NMTD8) [January 18, 2026](https://twitter.com/NMTD8/status/2012931324881822202?ref_src=twsrc%5Etfw) The general sentiment is that all these suggested a strategy to extract funds without fulfilling ICO obligations. The HYPE token has since dropped approximately 60% below its ICO price, leaving early investors exposed. In response, the Hyperliquid Foundation donated 10,000 $HYPE to blockchain investigator ZachXBT. This signals efforts to probe the token sales and distance the protocol from potential misconduct. > On-chain investigators don’t get enough credit. > > Hyperliquid Foundation just donated 10,000 [$HYPE](https://twitter.com/search?q=%24HYPE&src=ctag&ref_src=twsrc%5Etfw) > (~$254K) to ZachXBT confirmed by Zach himself. > > He confirmed it on-chain, and it’s one of the biggest donations he’s ever received. [pic.twitter.com/Wu2iV2xze5](https://t.co/Wu2iV2xze5) > > — Broke Doomer🔺 (@im_BrokeDoomer) [January 18, 2026](https://twitter.com/im_BrokeDoomer/status/2012942820303110152?ref_src=twsrc%5Etfw) ZachXBT, known for tracking crypto fraud and recovering stolen funds, is expected to provide clarity on whether the sales were part of coordinated misconduct or operational mismanagement. Despite the controversy, Trove Markets remains operational with mainnet plans set for February 2026. However, the TGE (token generation event) has been pushed to 4 PM UTC on Monday, January 19, 2026, two hours after the initial 7 PM UTC. > Due to the move to Solana and the refund processing, we need more time to execute this correctly. > > New TGE time: Jan 19, 4:00 PM UTC. > > We sincerely apologize for the delay. > > We’ll share the contract address and final distribution details once we are live. > > — TROVE (@TroveMarkets) [January 18, 2026](https://twitter.com/TroveMarkets/status/2012989706833657963?ref_src=twsrc%5Etfw) Yet, partial token dumps and the erosion of trust put the project at risk of failing to meet staking requirements under HIP-3. This could prevent the DEX launch and leave investors without recourse. > Trove Markets have been facing major fud for doing undisclosed influencer ads and now they have also shifted their token launch from hyperliquid to solana. > > So, zero right??? [pic.twitter.com/TRVzSb4AI0](https://t.co/TRVzSb4AI0) Trove markets did not immediately respond to BeInCrypto’s request for comment. Nevertheless, the incident mirrors the risks inherent in newer DeFi projects, particularly those involving permissionless protocols, large token allocations, and limited transparency.