Félez-Viñas, Ester and Johnson, Luke and Putnins, Talis J., Insider Trading in Cryptocurrency Markets (August 8, 2022). Available at SSRN: https://ssrn.com/abstract=4184367 or http://dx.doi.org/10.2139/ssrn.4184367

“We find evidence of systematic insider trading in cryptocurrency markets, where individuals use private information to buy coins prior to exchange listing announcements. Our analysis shows significant price run-ups before official listing announcements, similar to prosecuted cases of insider trading in stock markets. Leveraging blockchain data, we identify the specific transactions and wallets (individuals) that consistently trade before announcements, ruling out alternative explanations. We estimate that insider trading occurs in 10-25% of cryptocurrency listings and as a lower bound, insiders earned $1.5 million in trading profits. Our findings identify cases that are yet to be prosecuted.”