Original author: ChandlerZ, Foresight News
In the first month of 2026, RIVER, the native token of the chain abstract stablecoin system River, experienced an extreme inverted V-shaped reversal in just four weeks. It climbed from around $2 at the end of December 2025 to an all-time high of over $87, with an increase of more than 2,700%. Then, it fell sharply in just six days, dropping to a low of around $11, a drop of 87%.
This unusual market volatility has drawn significant attention from industry observers and on-chain data analytics firms. Following the disclosure of crucial evidence by third-party data agencies such as Bubblemaps on January 27th, allegations of RIVER token price manipulation, high concentration of early token holdings, and profit-taking by associated addresses are gaining traction.
New funding of $12 million, strongly endorsed by Arthur Hayes
The River project, developed by the RiverdotInc team, aims to build a chain-abstract stablecoin system for multi-chain ecosystems. This system connects assets, liquidity, and yields across different blockchains, enabling seamless cross-chain interaction without relying on traditional bridging or wrapping mechanisms.
On January 6th, BitMEX founder Arthur Hayes publicly called for CEXs to list the token and predicted its explosive growth. Hayes' endorsement gave RIVER a strong boost. Although most mainstream crypto assets were in a downward trend at the time, RIVER started a one-sided upward trend, with its market value more than quadrupling in just a few weeks.
On January 23, River announced the completion of a $12 million strategic funding round. In addition to Justin Sun Sun and TRON DAO, who were previously reported to be participating, this round of investors also includes Maelstrom Fund (founded by Arthur Hayes), The Spartan Group, and Nasdaq-listed companies and institutions from the US and Europe.
The official statement indicates that this funding will support River's expansion across EVM and non-EVM ecosystems (including TRON, Sui, and major EVM networks) and continue building on-chain liquidity infrastructure. The funds will be used to accelerate ecosystem deployment, deepen stablecoin liquidity, and promote the integration of satUSD in trading, lending, staking, and yield scenarios. Furthermore, River will launch yield products Smart Vault and Prime Vault, providing users and institutions with a unified interface for cross-ecosystem yield access through protocol-native and institutional-grade strategies.
Interestingly, just two days after RIVER announced its large-scale financing, its price hit a high point and began to decline.
Price manipulation tactics driven by funding rates
CoinGlass used River as an example to discuss how funding rates are used in conjunction with leverage structures to drive price volatility, emphasizing that this pattern has appeared on multiple tokens over the past two years, with River being just one case. They stressed that many traders misunderstand funding rates. Funding rates do not provide directional prediction signals; they provide information about the imbalance between long and short positions, corresponding to which side of the market is more crowded.
Step 1: Suppress prices while pushing funding rates into deep negative territory. First, keep prices low or suppressed, while simultaneously pushing funding rates into significantly negative territory. The result is increasingly concentrated short positions, and a consensus expectation forms in the market that negative funding rates imply a rebound is coming.
Step Two: Inducing some traders to long. During periods of deep negative funding rates, some traders will open long positions, motivated by expectations of a rebound and the hope of receiving funding rate payments. The author refers to this expectation as part of a trap.
Step 3: Negative funding rates can also trigger an upward push. CoinGlass's key argument is that when funding rates are extremely negative, prices don't need to enter a trend reversal. The market only needs a controlled upward push to trigger a chain reaction of short sellers, including liquidations, stop-loss orders, and forced covering.
Why do price surges occur when funding rates are still negative? Many sharp price surges begin when funding rates are still negative. The price increase is driven by the unwinding of leveraged positions, and passive buying in the market amplifies the gains. Once the short squeeze is cleared, funding rates quickly return to a more neutral level. Some traders see this return to negative funding rates as a sign of a healthy market.
CoinGlass warns that this is actually just a “reset” process of a trap, where operators can repeatedly go through the process of “creating extreme rates, attracting consistent positions, forcing liquidation, and resetting”.
Analysis: The creator of River is suspected to be directly related to a huge group of addresses, and profited $10 million from selling River shares.
According to Bubblemaps monitoring, a huge cluster containing more than 2,000 wallet addresses is directly related to RIVER.
It was pointed out that one month after RIVER launched, seven addresses withdrew 230 million RIVER tokens from Bitget. These wallets had no prior activity records and received the tokens within a tight time window on December 3 and 29.
One of the wallets, 0x6790, distributed 400,000 River tokens across hundreds of wallets. All of these receiving wallets showed a similar pattern: no prior activity, receiving similar amounts of River tokens, sending tokens to Bitget on January 9th, likely for a sale, funded by a single source, and going through four layers of hops.
Bubblemaps points out that the wallet address providing funding for the cluster is 0x365b, which is directly connected to the RIVER creator. Furthermore, the wallet 0x6790, which distributes RIVER tokens to the cluster, shows a link to the RIVER creator. They predict the cluster's expected revenue will be $10 million.
What is certain at present is that RIVER underwent a dramatic repricing process, going from a rapid rise to a rapid fall, in a very short period of time. Market attention has shifted from narrative and growth expectations to whether there are anomalies in the distribution of tokens and the flow of funds. The address clusters and related clues raised by Bubblemaps have further amplified suspicions of early token concentration, profit-taking by related addresses, and distribution through exchanges. The funding rates and position crowding mechanisms mentioned by CoinGlass provide another explanatory framework, suggesting that the derivatives structure may have amplified the magnitude of price fluctuations.
For the market, the RIVER incident serves as a reminder that tokens with low circulation and high elasticity are prone to extreme price movements when sentiment and structure resonate. When negative signals appear in the token supply and trading structure, price adjustments tend to be faster and deeper.
