Following its delisting from Binance, WAVES, a multi-purpose blockchain platform is gaining interest among traders. However, the sentiment is leaning towards mostly bearish, per market analysts. While Binance did not offer any explanations for removing the token, there have been accusations of fraud against its Ukrainian founder Alexander Ivanov [also known as Sasha Ivanov] since 2023.
Onchain sleuths accused Ivanov of orchestrating a scheme involving borrowing stablecoins like USDT and USDC against USDN [ a stablecoin collateralized by Waves] to artificially inflate the Waves coin price. This was accomplished by buying the token on exchanges, thereby pumping its price. The borrowed stablecoins were then sent to Vires Finance to purchase more stablecoins, offering attractive yields due to near-full utilization.
Soon, Waves coin plummeted by 93%, resulting in losses of $500 million for users in mid-June last year. However, the incident gained less media attention, which could have prompted Ivanov to continue pursuing his plan, and this time he went one step ahead. The founder proposed liquidating everyone shorting Waves and USDN on-chain forcing users to deposit more funds into the scheme or risk losing their assets.
WAVES Scandal Nightmare For FTX Creditors?
Although the proposal failed to pass, Ivanov injected liquidity into the scheme, leading to a temporary pump in Waves value. Additionally, changes were made to the governance structure, granting the team complete control over protocol changes. The most serious allegations against WAVES are that its founder embezzled $90 million from Alameda Research, a cause of concern for FTX creditors.
Overall, Ivanov’s actions highlight the risks associated with decentralized finance and the importance of thorough due diligence when participating in such platforms. The controversial founder responded to Binance’s delisting by saying that the platform is moving forward with new products and working on new governance protocols and DExs. He didn’t respond to the fraud allegations.
The end of an era. New dawn, new beginnings. WAVES is moving forward, launching new products, and working on new governance protocols. A new generation of DEXs will be able to onboard Web2 users to the Web3 world as well as CEXs, and I’ll try to participate in the process. We will, of course, collaborate with all centralized exchanges that want to work with us because blockchain is essentially about collaboration.
