Little-known Oyster token (PRL) surged on Friday, November 2, more than 1300% as a result of shady transactions on the exchange Coinsuper and stop trading on other venues. This was preceded by the outbreak around the project a scandal in which a key role played by its founder and chief systems architect, Bruno Block.
A few days ago, as told by the current head of the Oyster Protocol William Cordes, Bruno Block was used bedorom in the smart contract and assigned about three million tokens PRL. Then he translated these tokens to exchange KuCoin and sold them for $300,000.
“We found that has been transferDirector embedded in the smart contract Protocol, the Oyster. This feature allowed him to re-run ICO PRL and to reissue tokens (1 ETH = 5000 PRL / .04 per PRL)”, — stated in blog posts the project from October 30.
As explained by William Kordes, despite the fact that the smart contract went three independent verification, Bruno Bloc has insisted that management could be performed from any address.
“This contract was written by the Unit specifically for this ICO in that moment, when he was the only member of the team. Bruno was the only one who could change the owner of the contract within the contract itself. After our analysis, we are inclined to believe that it was Bruno with the goal to circumvent KYC, which KuCoin launches 1 November,” added Cordes.
According to the internal investigation, after creating a token, they were sent to the stock exchange and traded for BTC and ETH. Neither team Oyster, nor the members of the exchange did not stop the transaction because it had happened over 6 hours.
The bitcoin address associated with these transactions one day received 22 transfer to General 70.73449286 BTC. Also listed Ethereum address, the last four of a major transaction, which amounted to 186, 175, 177 and 515 ETH.
All these events took place on 30 October, and as stressed Cordes, it was purely a carefully planned operation from the Unit. In particular, he not only spent all the transactions before the introduction of KYC procedures on KuCoin, which resulted in the unverified users was introduced a limit on withdrawals in the amount of 2BTC daily, but have done it at a time when most of the staff exchange was offline.
Two days later, November 1, Bruno Block made contact with William Cordes. Screenshots of their correspondence in the Telegram was also posted on the project blog.
In conversation Unit admits to theft of funds and explains it, among other things, the fall in the price of Ethereum c $1,200 to the current $200. Also, citing the example Tether, he claims that the entire industry of crypto is a huge Ponzi scheme, and bitcoin will soon cost $20, and Ethereum will be back to $5.
According to him, he wanted to hire more people for project development, but due to the fall of the market couldn’t do it. He also accuses Cordes of insider trading and said that he fired, and finally tries again to justify his actions, saying the desire to protect his wife and children from the inevitable financial collapse that could happen any day.
In parallel, the Unit once again accused Cordes insider trading, this time in the remote now the official channel of the project in the Telegram.
Then William told the team that our tokens will be traded on Binance. From that moment the problems started. The price soared from 2 to 26 cents. I voted against trade tokens, but he didn’t care. I didn’t let him and his friends from venture capital funds to shit on you and shat on it”, — wrote the Block.
Cordes, in turn, said that the project is going to apply to law enforcement, actively works with lawyers and has hired a private detective.
Also, the project team launched a new Telegram-the channels through which now liaises with the community.
Please note that all discussion regarding Oyster has moved to two new channels Telegram: https://t.co/jP6V3lAFvX and https://t.co/TMc1TmGNvv #deltadirect
The Oyster Protocol (@OysterProtocol) 31 October 2018
The events continued Friday, November 2, when the PRL price suddenly went up rapidly, a few minutes up from $0.028 to $0.051. In this case, the reason was unusual activity on the stock exchange Coinsuper. Trading on other exchanges, where the presence of PRL, including KuCoin, by that time was already suspended.
The weighted average rate of PRL, according to CoinMarketCap, for the last day increased by 1335.93%
At the same time in Coinsuper this figure was +1674.05%
Team Oyster almost immediately reacted to the events, stating that it is fake volume, not related to the project. Also, the project contacted the property Coinsuper, and trades PRL on this site was soon frozen.
In the future we plan to restart the project. To this end, the developers plan to make the blockchain at the time of the stop trading on KuCoin and roll back history to this point.
Also, according to an announcement on Reddit, on 5 and 6 November, the project developers will hold a session of questions and answers, which will answer all interested in community issues.
The Oyster project is designed for site owners and allows them to earn revenue for storing files. The service works on the basis of technology IOTA Tangle. The users provide their computing power instead of viewing ads.
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