Defiance Capital Founder: Altcoin Markets Are a Rigged Casino and Exchanges Are in on It

Key Takeaways

• Altcoins market has become a rigged casino, says Defiance Capital founder.
• He pointed to the recent collapse of utility tokens and inflated valuations.
• Cheong urged major exchanges to act or risk collapse.

The altcoin market is increasingly beginning to resemble a “rigged casino,” according to Defiance Capital founder Arthur Cheong, who warned that collusion between crypto projects, market makers and centralized exchanges (CEXs) is eroding investor trust.

Cheong recently sounded the alarm on what he called a “black box” of pricing manipulation. His comments come amid fresh scrutiny of token listings and market structure following a series of sharp price crashes in both the DeFi and memecoin sectors.

Altcoins Market Could Risk Collapse

Cheong’s remarks follow the collapse of MANTRA’s OM token, which plummeted more than 90% on Monday. The crash renewed concerns over tokenomics manipulation and insider trading.

While MANTRA CEO John Patrick Mullin blamed the sell-off on forced liquidations triggered by CEXs like Binance, OKX pointed to the project.

The exchange flagged “significant changes” to OM’s tokenomics since October 2024, alongside suspicious trading patterns from linked wallet addresses dating back to March. It has since adjusted its risk controls and warned users of potential risks.

For Cheong, the OM crash reflects a deeper structural problem: token prices are often artificially propped up, leaving investors unsure if they’re trading based on real supply and demand or behind-the-scenes collusion between projects and market makers.

“Absolutely bizarre that CEXs are turning an absolute blind eye to this,” Cheong said . “The altcoins market is becoming more and more of a lemon market where confidence gets lesser.”

He added that pricing around this year’s token-generation events has been “an absolute joke,” with many coins down 70 to 90% within months of listing.

Without intervention from major industry players, Cheong warned that large parts of the market risk would become “uninvestable for the foreseeable future.”

Memecoins and the New Listing Playbook

Cheong’s critique wasn’t limited to altcoins. He also took aim at memecoins, which have undergone a dramatic shift in how tokens make their way onto CEXs.

For years, major platforms like Binance and Coinbase were selective, listing only a handful of memecoins with multi-year track records and robust liquidity.

That changed in 2024 and 2025 when newer, often unvetted memecoins began making it onto top exchanges—sometimes just days after launch.

While some of these tokens quickly reached billion-dollar valuations, much of the supply was concentrated in the hands of insiders.

The result, Cheong said, is that CEX listings increasingly serve as thinly veiled exit strategies for token creators.

Multiple memecoins have shed over 90% of their value within days of listing, burning retail investors who bought into the hype.