Recently, the analyst firm ChainArgos an unflattering article for Polygon management. It recorded the disappearance of around 400 million MATIC that should have gone to validators as staking fees. Another 367 million MATIC was withdrawn from the marketing fund.
In 2019, the young startup Polygon, formerly called MATIC, used BINANCE Launchpad to launch a token and attract investors. According to the white paper, 1.2 billion MATIC was intended for investors participating in a staking programme. Binance, for its part, confirms that this was the case: 12% of the 10 billion tokens were sent to validators.
The ChainArgos agency tracked the movement of coins and discovered that, as a result of shuffling, only 800 million MATIC reached investors. Polygon also didn't bother to hide the evidence. 300 million MATIC for staking was poured into the address, where 466 million MATIC from the "marketing and ecosystem" section were later added. This definitively linked the addresses to Polygon, leaving no doubt about the maliciousness of the actions.
Later, the coins migrated to a Binance address for subsequent sale. The analysts concluded from this that the cryptocurrency exchange was involved in the foul play. The movement of funds simply couldn't go unnoticed. They estimate that project managers withdrew a total of 767 million MATICs, which was worth about $1 billion at former prices. A detailed analysis can be found at the link at the beginning of this article.
In addition to direct investors losing funds, token buyers on cryptocurrency exchanges also suffered, as the coin withdrawals and disguised sales were followed by a major drop in MATIC's price starting in January 2022.
ChainArgos notes that the white paper isn't legally binding in the same way as a shareholder agreement. That's why Polygon faces no criminal liability for its dishonest policy regarding notice of planned actions. Privately, investors can take legal action if the company's actions resulted in direct losses.
StormGain Analytical Group
(platform for trading, exchanging and storing cryptocurrency)
