This week the Ethereum-based Matchpool CEO is facing scrutiny. The co-founder is accused of withdrawing Initial Coin Offering (ICO) funds from the project’s multi-signature account. According to sources, people witnessed 37 thousand ether leave the projects’ ICO address.
Ethereum Appcoin Matchpool CEO Suspected of Mishandling ICO Funds
Over the past twelve months, the cryptocurrency community has had a fervent relationship with Initial Coin Offerings and the tethered appcoins involved with these crowdfunds. Millions of dollars have been raised by ICOs, and speculators believe quite a few of the projects have little to offer. Another problem is people’s perception of fund management. One issue arose this week as the project Matchpool‘s CEO Yonatan Ben Shimon was accused of mishandling ICO funds.
Matchpool calls itself a decentralized matchmaking protocol that claims to use Ethereum smart contracts within its application. The project has a two-year roadmap and a token called “Guppy,” which “will play an integral role in its development,” the Matchpool team explains. With the projects marketing techniques and plans the Matchpool organization raised $5.7 million worth of ether in 48 hours during its crowdsale.
ICOs are totally fine.. Nothing to see here!! Eth definitely not a scam!! https://t.co/7WRBJVGIxn
— Paul Sztorc (@Truthcoin) April 6, 2017
37500 ETH Leaves Matchpool’s ICO Multi-Sig Address
Shortly after the successful crowdfunding, one of the co-founders of Matchpool, Philip Saunders, detailed he was leaving the project. Furthermore, Matchpool investors were shocked to hear that $1.6 million in ether was removed from the ICO multi-signature address. Matchpool’s co-founder writes;
Over the last two days, 37500 ETH has been withdrawn from the multi-sig wallet by the CEO Yonatan Ben Shimon without any explanation or announcement due to the need for “hedging.” Yonatan keeps claiming he’s working with Bitcoin Suisse and it’s all ok, but so far I haven’t seen any evidence of this. I suggest you all demand and explanation and keep a close watch. In all likelihood your guppies are worthless.
‘Well Below Blockchain Project Standards’
Shimon and his team were initially silent about the withdrawal, and investors are afraid they might’ve been taken.
However, team members have stated that funds are secured in bitcoin due to Ethereum volatility.
The news about the Matchpool situation immediately went viral across the cryptocurrency community throughout many social media platforms. The co-founder who left the team, Saunders said Matchpool was “well below the standards needed for a blockchain project” and because of the lack of transparency, he must leave.
Matchpool team members are denying all “exit scam” accusations and explained the funds were converted to bitcoin due to Ethereum’s recent price dive.
One of the other Matchpool co-founders believes a screenshot of the funds on a Trezor wallet confirms the money is safe alongside an address with $1.7 million BTC. However, many cryptocurrency enthusiasts are skeptical since Saunders has left with so many accusations on the table.
“We sold the Ether for Bitcoin to hedge against the volatility of the Ether price. We have the responsibility to build a great project and that is what we are going to do. You can see all the evidence of the cold Trezor wallet here,” Matchpool representative, Maximus Richardson explains.
We had a miscommunication within the team and I want to correct my original post. The funds were not sent to BitcoinSuisse. The funds were sent to a secure Trezor wallet, which can be seen below. It was a hectic day we’ve had a couple of sleepness nights so I apologise for the misinformation.
Matchpool has joined the ranks of the many appcoins who’ve raised millions in ICOs over the past year. Meanwhile, many have wondered how legal these types of crowdfunds are in the eyes of the law, especially after the DAO debacle last summer. With the Matchpool situation, it’s possible the funds were simply moved to escape volatility.
Yet, cryptocurrency spectators believe it is odd a co-founder left while leaving behind very serious accusations of shady activity. Exit scams in the crypto-world are not taken lightly.
What do you think about the shenanigans with Matchpool’s ICO funds? Let us know in the comments below.
Images via Shutterstock, Matchpool’s website, Linkedin, and Twitter.
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