ZachXBT Accuses Axiom Employees of Exploiting Internal Wallet Data for Insider Trading
Blockchain analyst ZachXBT released a detailed thread on X alleging that staff at the crypto‑trading platform Axiom used internal monitoring tools to identify users’ private wallet addresses and trade on that information. The claims, which stem from recordings and internal screenshots, have sparked a swift response from the firm and reignited discussion about compliance standards in the fast‑growing DeFi‑trading space.
The allegations
In a series of posts published on X earlier this week, independent blockchain investigator ZachXBT presented what he describes as “internal tools” that allegedly gave certain Axiom employees the ability to look up a user’s referral code, wallet address, or unique identifier and then retrieve the associated transaction history. According to the thread, the misuse dates back to the first months of 2025 and involves a senior business‑development representative based in New York, identified as Broox Bauer.
Audio excerpts cited by ZachXBT capture Bauer saying he could track “any Axiom user via ref code, wallet, or UID” and that he was gradually expanding the number of wallets he monitored to avoid drawing attention. In a separate recording, Bauer outlines a plan to provide a colleague with a “full list of wallets” to facilitate a $200,000 profit, implying that the information would be used for front‑running or other forms of insider trading.
Screenshots posted in the thread show internal dashboards listing private wallet addresses, linked accounts and transaction details. Additional documents appear to map wallet holdings of prominent traders and memecoin promoters, suggesting a systematic effort to flag high‑value accounts.
Axiom’s background and response
Axiom, founded in 2024 by Henry “Mist” Zhang and Preston “Cal” Ellis, quickly rose to prominence after graduating from Y Combinator. The web‑based terminal reported tens of millions of dollars in fees within weeks of its January 2025 launch, positioning it among the most profitable newcomer platforms in the crypto‑trading sector.
Following the public accusations, Axiom posted a statement on X expressing “shock and disappointment” that an employee allegedly abused customer‑support tools to access wallet information. The company announced that it had revoked the implicated employee’s access to the internal monitoring system and that an internal investigation was underway. Axiom also pledged to hold any responsible parties accountable, though it did not comment on potential regulatory ramifications.
Potential legal exposure
Because the alleged wrongdoing originated from a New York‑based employee, experts note that the case could fall under the jurisdiction of the Southern District of New York, a venue that has previously pursued insider‑trading and securities‑fraud cases involving digital assets. While no criminal charges have been filed to date, the allegations raise questions about whether Axiom’s internal data‑access policies comply with existing securities‑law frameworks.
Market reaction
The timing of ZachXBT’s disclosure coincided with unusual activity on a prediction market. Lookonchain, an on‑chain analytics service, observed that two anonymous wallets placed a $59,800 bet on Axiom’s token on Polymarket shortly before the accusations were made, turning the wager into roughly $109,000 within three hours. It is not yet clear whether these bets were linked to the alleged insider information.
In the days leading up to the expose, a self‑identified “Axiom affiliate” operating under the handle devininsider dismissed speculation about insider trading, describing the platform as a “simple terminal for open‑market memecoins.” The dismissive tone underscores the divide between community sentiment and the seriousness of the accusations.
Analysis
The episode highlights several emerging risks for rapidly scaling DeFi‑oriented trading platforms:
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Data‑access controls – Internal tooling that can surface private wallet information must be tightly governed. The lack of monitoring or segregation of duties, as suggested by the screenshots, creates an environment where abuse can occur with minimal detection.
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Regulatory scrutiny – As platforms like Axiom aggregate significant trading volume, they attract attention from regulators who are increasingly willing to apply traditional securities‑law concepts to digital‑asset markets. Insider‑trading allegations could prompt enforcement actions, especially when the alleged activity involves U.S. persons or entities.
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Reputational impact – Trust is a cornerstone of crypto‑trading services. Even unproven claims can erode user confidence, potentially driving traders to more privacy‑focused alternatives or to platforms that demonstrate robust compliance frameworks.
- Market manipulation signals – The rapid conversion of a sizable Polymarket bet into profit may be indicative of informed trading, but without concrete links to the alleged data leak, it remains speculative. Nonetheless, it adds a layer of complexity for market participants monitoring sentiment around Axiom.
Key takeaways
- Alleged insider misuse – Internal dashboards at Axiom reportedly allowed a senior employee to retrieve private wallet data and plan profitable trades.
- Evidence presented – Recordings and screenshots released by analyst ZachXBT form the basis of the accusations, though no legal verdict has been reached.
- Axiom’s immediate action – The company removed the employee’s access to the tools in question and launched an internal review.
- Regulatory considerations – The New York connection could bring the matter under the Southern District of New York’s jurisdiction, raising the prospect of enforcement.
- Industry implications – The case underscores the necessity for stricter data‑governance and compliance measures on crypto‑trading platforms as they scale.
Outlook
While Axiom has taken steps to contain the alleged breach, the episode serves as a cautionary tale for the broader crypto‑trading ecosystem. Institutions that handle large volumes of user data must implement transparent access controls and monitoring to prevent potential insider abuse. As regulators continue to tighten scrutiny of digital‑asset markets, platforms that fail to demonstrate robust compliance may face both legal exposure and erosion of user trust. The ongoing investigation will likely set a precedent for how similar cases are handled in the nascent DeFi‑trading sector.
Source: https://thedefiant.io/news/defi/zachxbt-accuses-axiom-staff-of-insider-trading-using-wallet-data
