New analysis of the top 10,000 Ether wallet addresses certainly paints a very bullish picture for Ethereum as it moves towards Proof-of-Stake consensus. However, it also suggests that some highly questionable practices are being employed by certain major cryptocurrency exchanges and Ether (ETH) whale accounts.

The Poloniex/Tron axis

According to the report’s author, Adam Cochran, when Circle bought Poloniex back in February 2018, it moved assets into better cold wallets and had strong reserves. However, when the exchange was acquired by a group that included Tron’s Justin Sun, it is speculated that some of these cold wallets were drained to become fractional reserves.

The wallets appear to have only been drained into exchanges listing Tron (TRX). This coincided with an increase in Tron buying activity and a 50% pump in token price.

While this may simply have been Poloniex cross-market trading on other exchanges, Cochran questions whether the exchange’s purchase by Sun was actually just a scheme to boost the price of Tron.

A Tron spokesperson told Cointelegraph that Cochran’s analysis was incorrect and contained ‘falsifications’. The spokesperson said the claim that cold wallets were drained “did not happen”, nor did Sun invest in Poloniex in order to increase the price of Tron.

Bitfinex in on market manipulation?

Cochran also highlights the methods used by a group of at least 12 whale accounts. These accounts seem to manipulate the market in coordination with Bitfinex and possibly also BitMEX.

Firstly, short positions on Ether increase, starting on Bitfinex then spreading to BitMEX and others. This is followed by an influx of ETH onto exchanges, sent in small batch transfers to avoid detection by systems like WhaleAlerts.

When the market dumps, the whales profit on their shorts and buy back the ETH at a lower price.

The most controversial claim by Cochran is that cold wallets belonging to Bitfinex appear to get in on the dumping action around 40% of the time.

Bitfinex used user-funds to sway ProgPoW vote

Another allegation against Bitfinex concerned the use of user-funds to vote for the move to Programmatic Proof-of-Work (ProgPoW). Before the vote, Bitfinex moved 1.17 million ETH between cold and hot wallets in order to get behind ProgPoW.

As only about 3 million ETH in total was involved in the voting process, this suggests that Bitfinex represented over 40% of the vote. According to Cochran, this shows that the community was not actually behind ProgPoW, which was being pushed by big self-interested parties.

Haters gonna profit and stealth exchanging

Ethereum often finds itself at the sharp end of disinformation campaigns on Twitter. Occasionally these spikes have an effect on price. With that in mind, Cochran mapped whale transfers to tweet volume and sentiment related to ETH. While most whales moved money to exchanges after a social media spike amidst anti-ETH rhetoric, a handful made transfers before the spike.

In fact, this handful of whales managed to preempt the negative sentiment peaks on Twitter an astonishing 86.7% of the time. Which rather suggests that the same whales might be behind the FUD.

Finally, Cochran notes that Coinbase is rather stealthy and does more to obfuscate transactions to and from the exchange. It does this through a mix of changing wallets and mixing funds in a way that the majority of exchanges do not.

In contrast to the other highlighted exchange behaviours, many users will be happy to know that Coinbase employs this tactic.

May 1: This article has been updated to include a response from Tron.