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.
Trove Markets Faces Allegations Over $10 Million HYPE DumpThe project had raised $20 million through an initial coin offering (ICO) to secure 500,000 $HYPE tokens, a stake required for permissionless deployment under Hyperliquid’s HIP-3 protocol.
On-chain data from wallet 0xebe07e526c4dc5f0005801bbd7d9850c424cf719 confirms that sales began with a modest 6,196 $HYPE worth approximately $160,000 at current HYPE rates.
Hyperliquid (HYPE) Transactions Linked to Trove Markets. Source: Hypurrscan.io
However, the activity quickly escalated. Hyperliquid News reported that 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 pic.twitter.com/kLZ5tN2Oky
— Hyperliquid News (@HyperliquidNews) January 18, 2026Complicating the situation, Trove’s founder reportedly 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.
The rapid continuation of sales fueled speculation of either insider fraud or compromised wallet access, intensifying community concern.
Hyperliquid Foundation Engages ZachXBT to InvestigateThis 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.
Trove ICO Bets. Source: Polymarket
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
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 (~$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