Why Chinese Police Is Investigating This Crypto Staking Project.
STFIL, the main Filecoin (FIL) staking platform, has revealed that its main technical team members are being investigated by the Chinese police. The company announced this information on April 9, 2024 at 04.53 UTC on its official X (formerly Twitter) account.
STFIL said they have deployed legal advisers to assess the situation and provide support to those arrested.
Millions in Filecoin were moved when the STFIL group faced scrutiny
The announcement comes after an undisclosed protocol update and a large transfer of FIL tokens from the STFIL platform to an unknown address. Currently, that address holds approximately 2,568,022 FIL, worth $23.09 million.
Read more: Filecoin Staking: How to get started
STFIL encouraged the community to attend the address. He also invited stakeholders to participate in discussions focused on safeguarding the interests of stakeholders.
Community reaction to the news has been mixed. Some expressed confusion and sympathy, while others, like crypto analyst Neeraj Singh, alleged foul play. It has made a significant investment of $80,000 in FIL and has expressed its commitment to the long-term success of the FILCOIN community, which collectively holds 5.2 million tokens, according to the statement.
Singh termed the issue as “carpet-pulling” and said the contract amendment allowed for targeted withdrawals.
“The project owner changed the contract to allow only one specific address for withdrawal. Then funds were withdrawn from the contract,” Singh said.
Singh also openly requested the FileCoin Foundation to end his address and help affected FIL holders.
Read more: Filecoin (FIL) Price Prediction 2024/2025/2030
STFIL ranks as the second largest liquid storage protocol in the Filecoin ecosystem. DeFillama's current total value (TVL) is locked at $39.08 million. Its TVL is behind GLIF, which has a value of $324.2 million.
Following the incident, STFIL's official website indicated that the protocol's liquidity was only 2,141 FIL (approximately $19,226).
However, this news will not adversely affect the price of FIL. Although slightly lower to $8.85, $FIL is now trading at $9, representing a 1.4% decrease in the last 24 hours.
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