Onchain investigator ZachXBT has tied the recent 97% price drop of the LAB (LAB) token to an entity that was originally funded by the LAB team. This revelation has intensified scrutiny on LAB Trade, as the token has suffered significant losses in the wake of this crash. While the LAB team has denied that any project-related issues caused this decline, the investigation has raised questions about the integrity of the market surrounding LAB.
In a Telegram post, ZachXBT detailed his findings, indicating that the selling pressure originated from a wallet that received over 196 million LAB tokens from the team in April 2026. Following this, the tokens were transferred to four Bitget deposit addresses, with approximately 100 million LAB remaining inactive for weeks before the distribution resumed on July 10.
The investigator noted that the entity commenced selling 18.4 million tokens on the decentralized exchange Aster, leading to a steep drop in LAB's price from $1.2 to just $0.55. Currently, the entity retains 81.5 million LAB, which suggests further selling pressure could be on the horizon. ZachXBT expressed disappointment over the lack of action from exchanges like Bitget, Binance, and Gate, suggesting their inaction allowed for blatant market manipulation.
In response to the ongoing decline, which has seen LAB drop more than 97% this past week, the LAB team stated that they are facing substantial selling pressure from large market players, including several independent trading firms. As a countermeasure, the team has decided to burn 10 million LAB tokens, representing about 1% of the total supply, in an attempt to stabilize the price. This action was confirmed by on-chain data showing the tokens moved to a null address.
The recent downturn follows a previous crash where LAB lost 77% of its value from a peak of $27.96 in June, erasing around $6 billion from the market. Although a subsequent rally recovered some losses, the latest developments will determine if the token burn can prevent further declines or if selling pressure will continue.
This material is informational and not financial advice.
