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Terra Founder Do Kwon allegedly voted on his own proposal using one of his secret wallets

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Terra Founder Do Kwon allegedly voted on his own proposal using one of his secret wallets

Terra Founder Do Kwon allegedly voted on his own proposal using one of his secret wallets Anthony Clarke · 10 hours ago · 2 min read

Terra › Rumors

Another investigation has been launched into allegations that the CEO of Terraform Labs manipulated the voting on some proposals by using a secret wallet.

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2 min read

Updated: June 14, 2022 at 5:02 am

Cover art/illustration via CryptoSlate

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Do Kwon, the founder, and CEO of Terraform Labs, has faced multiple allegations of foul play regarding the collapse of the Terra (LUNC) cryptocurrency and TerraUSD (USTC) stablecoin. Allegations have ranged from siphoning $8 million monthly to withdrawing $2.7 billion from the Terra ecosystem via DegenBox.

Now the Terraform Labs CEO has been accused of vote-rigging by a Twitter whistleblower. According to the pseudonymous whistleblower FatMan, Do Kwon broke Terraform Labs rules by using one of his secret wallets to vote on the firm’s proposal for Terra Station.

FatMan’s made these claims via his Twitter account, saying: 

“Caught. The ‘mystery’ wallet with a 20M LUNA airdrop that was voting on Do’s own proposal, delegating to North Star, insider trading ASTRO, etc. – it is officially confirmed that it belongs to Do Kwon himself.”

The tweet also includes a screenshot of a past Twitter thread where FatMan tried to find the true identity of the “mystery wallet” that voted “Yes” to Do Kwon’s proposal with 5% of the voting power and funded by 20 million LUNA tokens.

Do Kwon responded by saying he would draw the line at “doxxing wallets” and urging the whistleblower to “stay above the witchhunt”.

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FatMan tried to inquire about the relationship between the wallet and Terraform Labs to which Do Kwon responded by saying that the wallet belonged to the “Token purchase agreement holder with TFL [Terraform Labs]”, and then declining to comment any further.

Caught. The ‘mystery’ wallet with a 20M LUNA airdrop that was voting on Do’s own proposal, delegating to North Star, insider trading ASTRO, etc. – it is officially confirmed that it belongs to Do Kwon himself. (1/3) pic.twitter.com/QqfBnk6Oxe

— FatMan (@FatManTerra) June 12, 2022

This tweet is part of a three-tweet thread that outlines the allegations with links to the Columbus-5 proposal and Do Kwons alleged secret wallet.

FatMan went on to say that Do Kwon used the same secret wallet to send in a proposal titled “Columbus-5 Mainnet Upgrade Proposal and Recommendations” in the month of August 2021. 

FatMan shared one of the proposals referred to as Col-5 Agora to provide further evidence that Do Kwon used the wallet to vote on specific proposals. In this particular proposal, the wallet was used to vote multiple times to ensure that the proposal was successful.

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As FatMan pointed out, the wallet in question is Kwon’s second choice wallet for casting votes on proposals.

Col-5 Agora proposal submitted by Do: https://t.co/TwjAsLkwHG

Corresponding on-chain proposal authored by Do Kwon (submitted from the mystery wallet):https://t.co/gSnqU8NWeP This is Do Kwon’s verified alternate wallet. Credits to @FitManTerra for the spot. (2/3)

— FatMan (@FatManTerra) June 12, 2022

FatMan finished off the thread by pointing out that Terraform Labs claimed they wouldn’t vote on proposals or take advantage of inside information. The whistleblower also went on to claim that the company only wants to “extract more money out of the community”:

“They told you TFL doesn’t vote. They told you TFL didn’t get the drop. But you’ll notice that every tiny thing they do is to extract more money out of the ‘community’ through wordplay and manipulation. He doesn’t care about you. You are an instrument to him and always were.”

They told you TFL doesn’t vote. They told you TFL didn’t get the drop. But you’ll notice that every tiny thing they do is to extract more money out of the ‘community’ through wordplay and manipulation. He doesn’t care about you. You are an instrument to him and always were. (3/3)

— FatMan (@FatManTerra) June 12, 2022

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Terraform Labs and its founder Do Kwon has come under increasing scrutiny since the LUNA/UST scandal. In May, the Luna 2.0 airdrop was unevenly distributed amongst original LUNA holders, as well as money laundering allegations and an investigation by authorities in South Korea.

Culture

A-list celebs remove NFT avatars amid crypto winter

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A-list celebs remove NFT avatars amid crypto winter

A-list celebs remove NFT avatars amid crypto winter Zeynep Geylan · 11 mins ago · 2 min read

Many celebrities who displayed their NFTs as avatars are removing them from their social media due to the depressing sentiment of the market.

2 min read

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Updated: June 24, 2022 at 9:51 pm

Cover art/illustration via CryptoSlate

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Most celebrities who bought and displayed NFTs as social media avatars are now removing them amid the harsh crypto winter, which has led to a downturn in NFTs as well.

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The fast-paced nature of the crypto market attracted celebrities who want to invest their fortunes. Some of the biggest names in Hollywood including Justin Bieber, Ashton Kutcher, and Bruce Willis participated in various projects. Many also purchased NFTs, especially from the Bored Ape Yacht Club (BAYC) collection during 2021.

Is the  NFT hype dead?

Most celebrities who proudly displayed their BAYCs as a Twitter avatar have recently changed them, including Serena Williams, Reese Witherspoon, Lil Durk, Travis Barker, and Shonda Rhimes.

Jimmy Fallon

Jimmy Fallon was especially proud of his ape. He showed a copy of it during his show featuring Paris Hilton and said they were “a part of the same community.”

Jimmy & @ParisHilton compare #BoredApeYC NFTs. #FallonTonight pic.twitter.com/RoOlhteLnN

— The Tonight Show (@FallonTonight) January 25, 2022

Despite his then excitement, Fallon changed his avatar to a selfie on June 8, 2022. However, he kept the .eth extension near his name, indicating that he’s still a part of the community.

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Why did they buy in the first place?

Not many of the stars came forward to explain why they purchased NFTs. In the case of Jimmy Fallon, he purchased an Ape because he felt like it was a good idea after talking to Hilton about it. Buying one because everyone else is doing could be a reason for billionaire celebs to purchase NFTs.

Studies show that the real reason behind the NFT hype is the high return on investments. While 64% of the participants said they purchased NFTs to make money, only 14.7% of them said they bought them because they wanted to be included in a community. Even though the study is not specifically about Hollywood stars, it wouldn’t be surprising for the A-list celebrities to pursue high returns on investment.

Paris Hilton was the only one who publicly explained why she was excited about NFTs. She wrote a blog post to stress that NFTs bring great benefits to small artists and creators. She wrote:

“I see NFTs, or non-fungible tokens, as the future of the creator economy. They use blockchain technology to help creators increase the value of their work and share it with fans in real-time,”

It seems like Hilton was genuine in her post, given that she is still keeping her NFT avatar and the .NFT extension in her Twitter account.

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Proposed Gillibrand-Lummis crypto Bill uploaded to GitHub for recommendations

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Proposed Gillibrand-Lummis crypto Bill uploaded to GitHub for recommendations

Proposed Gillibrand-Lummis crypto Bill uploaded to GitHub for recommendations Oluwapelumi Adejumo · 6 hours ago · 2 min read

Senator Lummis has opined that the bill is seeking comments from industry stakeholders so that it can properly reflect the innovations in the crypto space.

2 min read

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Updated: June 24, 2022 at 6:53 am

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The proposed Responsible Financial Innovation Act (RFIA) bill has been uploaded to GitHub for the crypto community to give their recommendations about the bill.

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In a Twitter post by Senator Cynthia Lummis, one of the two bipartisan senators responsible for the bill, the decision to update it on GitHub is to get the grassroots opinion about the bill.

Plebs! As promised, you can now contribute comments on my bill establishing a framework for digital assets with @SenGillibrand via GitHub. Civil comments and criticisms welcome. Please share widely. We want to get this right. Help us iterate publicly on policy. https://t.co/1eOb6jfKaA

— Cynthia Lummis 🦬 (@CynthiaMLummis) June 22, 2022

According to a press statement from the Senator’s office, the bill seeks comments from industry stakeholders to reflect the space’s innovations properly.

The bipartisan had suggested that Bitcoin and Ethereum be classified as commodities while other altcoins should be labeled as securities. The bill also proposed that the Commodity Futures Trading Commission should be tasked with regulating the industry.

However, the bill has faced criticism from the community over its blanket classification of other crypto assets as securities. Some argue that Bitcoin should be considered separately from other digital assets.

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Crypto community makes recommendations

As of press time, there have been only nine comments on the bill, with most of them being constructive recommendations.

One of the comments called for a separate Bitcoin Bill that is different from the crypto Bill. Stduey explained that Bitcoin is different from other risky assets even though the current market downturn might make it feel like both are the same.

In his words,

If you buy 5,000 satoshis for $1, you will have 5,000/2.1 quadrillion satoshis forever, and no one can change that. People cannot understand the magnitude of this yet, but this subtle difference is what separates bitcoin from every other crypto, fiat, precious metal, and commodity. Absolute scarcity. Nothing else has this feature.

Another recommendation for the bill was made by Asherhopp, who said that the legislation should include language that will limit the Federal Reserve from creating unlimited CBDC, the same way fiat currencies are minted.

He added that the bill should compel the Fed to add crypto to its balance sheet, apply tariffs to the digital yuan, and ban any CBDC.

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One of the recommendations touched on the subject of airdrops and unrealized gains.

According to the recommendation,

Airdrop receivers should only have to pay short or long-term taxes on the coins they cash out assuming the initial value is $0 because they do not realize the gains until they trade or sell.

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Saylor goes full maxi, slamming everything that isn’t Bitcoin

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Saylor goes full maxi, slamming everything that isn’t Bitcoin

Saylor goes full maxi, slamming everything that isn’t Bitcoin Samuel Wan · 9 hours ago · 2 min read

Saylor listed three things that weigh down on Bitcoin, one of which is the cross-collateralization of altcoins, which he deems unregistered securities.

2 min read

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Updated: June 22, 2022 at 2:00 pm

Cover art/illustration via CryptoSlate

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MicroStrategy CEO Michael Saylor has thrown altcoins under the bus by calling on regulators to do their part in tackling risky crypto industry practices.

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Speaking to the founder of technical analysis platform Northman Trader, Saylor told Sven Henrich that a “parade of horribles” is weighing down on Bitcoin and regulators must act accordingly.

A “parade of horribles is dragging down Bitcoin”

In explaining the “parade of horribles,” Saylor listed three factors that negatively impact the price of Bitcoin.

First is the prevalence of wash trading in the crypto space. Unlike stocks, there are no specific regulations that address the wash trading of digital assets.

Wash trading is a form of market manipulation involving simultaneously buying and selling an asset. This practice can create a false picture of what is happening in the market, such as artificially high volume.

This leads to the next factor, which Saylor said was the effect of unregulated exchanges and the market volatility they bring. Expanding further, the MicroStrategy boss talked about a conflict of interest in exchanges acting as both market makers and token holders, in conjunction with wash trading and trading with high leverage.

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“If you had 20x leverage trading on Apple stock with no wash trading rules, Apple would be a lot more volatile asset and so would the Nasdaq.”

Finally, Saylor turned to altcoins and said only Bitcoin is a commodity because it has no issuer. He added that the 19,000 other cryptos are unregistered securities. The result is a multi-hundred-billion “cloud” trading without fair disclosure that is “cross-collateralized” with Bitcoin.

“What you have is a $400 billion cloud of opaque, unregistered securities trading without full and fair disclosure, and they are all cross-collateralized with Bitcoin.”

Split in the regulatory treatment of crypto on the cards

On May 18, Securities and Exchange Commission (SEC) Chair Gary Gensler told the House Appropriations Committee that Bitcoin is a commodity “maybe.”

Currently, in the U.S., crypto-assets are governed under the jurisdiction of the SEC and treated under applicable securities laws.

Speaking to CNBC on May 16, the Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam said it makes sense to go through all the cryptocurrencies, classifying each as a commodity or security, and designating the appropriate agency authority accordingly.

“Within this space, in my view, it makes sense for commodities to be regulated by the Commodity Futures Trading Commission and securities to be regulated by the SEC.”

Behnam said that Bitcoin and Ether fit the definition of a commodity in his opinion. But there are also “plenty” of other tokens that fall within that category.

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