Polygon is facing questions over 400 million MATIC allegedly missing from its staking allocation — but most other projects have also not accurately followed their publicized token distribution strategies, says blockchain data firm ChainArgos.
Jonathan Reiter, CEO of the Singapore-based company, tells Cointelegraph that it has not yet encountered a single company that has fully honored the token distribution plans initially presented to investors.
“You’ve certainly seen questions about a very wide range of projects and whether or not the token allocations made any sense,” said Reiter.
“Essentially, every project we’ve ever looked into wasn’t done correctly.”
Making the situation worse for tokenholders, legal experts say the practice probably isn’t illegal in most cases, given that white papers are not accorded the same contractual status as an investment prospectus. Civil action may be a possibility in some cases, however.
ChainArgos is best known for unveiling the mismanagement of Binance USD (BUSD) last year, a stablecoin overseen by Paxos with Binance’s branding. The world’s largest cryptocurrency exchange has admitted that the stablecoin was undercollateralized by more than $1 billion in multiple instances.
ChainArgos CEO Jonathan Reiter (left) and general counsel Patrick Tan. (ChainArgos/YouTube)
ChainArgos accuses Polygon
ChainArgos has accused Polygon of misappropriating at least 400 million MATIC tokens intended for its staking program in a research report. Polygon is an Ethereum scaling network whose native token, MATIC, has the 16th largest market cap worth $7.34 billion, according to CoinGecko.
Polygon launched in 2017 as a proof-of-stake sidechain to help scale Ethereum and is now aggressively expanding into an ecosystem of zero-knowledge-proof solutions. MATIC’s market value was worth $20 billion at its peak.
Polygon states on its website that it set aside 1.2 billion MATIC at launch, or 12% of the 10 billion total supply, for…
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