Polywhale Team Abandon $100 Million Project Amid Scam Allegations

Polywhale Team Abandon $100 Million Project Amid Scam Allegations
Blockonomics


Key Takeaways

Polywhale Finance, the first yield farm on Polygon, has abandoned the project and withdrawn over $1 million in tokens.
The team said they were quitting due to bad tokenomics and poor market conditions, a claim dismissed by others.
Community members describe the incident as a “soft rug,” a fraudulent exit scam in which project founders sell own tokens on the market.

Share this article

Polywhale Finance, the first-ever yield farm on Polygon has been abandoned by its founding team amid rug pull allegations.

Polywhale: Another Yield Farming Exit Scam?

The team has stated in an official statement that they are moving on due to bad token economics and market conditions.

“We have decided that we will no longer be developing the project for multiple reasons,” the team wrote in their final note amid allegations of an exit scam from community members.

bybit
Source: Telegram

Even though the team blames its exit on tokenomics, there are indications of malicious intent. The official Telegram chat group has been deleted and there is a consensus among community members that the project was a potential scam.

Community members describe the incident as a “soft rug,” a situation when project founders abandon a project after dumping their own tokens on the market in exchange for stable coins.

Polywhale Finance was launched in April 2021 by an anonymous team. It functioned as a yield farm, offering its users a chance to make incredibly high returns on their deposited funds.

Users could stake various tokens including Matic, Quick and several other tokens to earn as APRs as high as 1000% in the native token called Krill.

Up until last week, Polywhale had a total value locked of over $100 million across liquidity pools as well as other single asset pools.

But the team recently started draining funds from its treasury. A specific transaction shows that the Polywhale team drained over $1 million from the project’s treasury from their meant for future development, and sent them to their own wallets.

“They were draining funds for five days ago while still advertising they were going to add new dev features, it’s not a simple shutdown it’s an exit scam,” one community member told CryptoBriefing.

Soon after the team announced their exit, the price of Polywhale’s native KRILL token crashed from trading at $1.5 on Jun. 18 to now $0.13, according to CoinGecko.

Polywhale is not the only recent scam on Polygon. The ongoing yield farming craze, high amounts of liquidity, and negligible fees has made the network a perfect venue for scammers to thrive.

Over the weekend, two other smaller yield farms, Polycash Finance and Polysa Finance executed soft rug pulls, and dumped native tokens on their users before deleting social media accounts.

Such incidents follow the highly advertised and notorious collapse of Iron Finance, an algorithmic stable coin project on Polygon that suffered from a massive liquidity attack. Several commentators have alleged the Iron Finance incident may have also been a result of a soft rug pull, similar to Polywhale Finance and others.

Share this article

The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

See full terms and conditions.

Iron Finance Denies Rug Pull After Token Collapse

Iron Finance’s governance token completely collapsed last night. According to the team, the project’s TITAN token suffered from a bank run after users were urged to remove liquidity from all…

Crypto Criminals Bagged Nearly $2 Billion in 2020

CipherTrace has published its Cryptocurrency Crime and Anti-Money Laundering Report, outlining 2020’s biggest trends in digital crime. Ponzi Schemes and Other Scams In 2020, crypto criminals stole a total of…

Yield Farmers Are Migrating to Polygon

Polygon offers a similar yield farming experience to Ethereum mainnet at a fraction of the cost. Key metrics show that DeFi power users are starting to migrate to the network….

What is Kusama? How Polkadot’s playground accommodates blockchain de…

Kusama is relatively young and was founded in 2019 by Dr. Gavin Wood, who also founded the Web3 Foundation and co-founded Ethereum. The team behind Kusama is essentially the same…





Source link

Minersgarden

Be the first to comment

Leave a Reply

Your email address will not be published.


*