Polygon Wallet Controversy Unveiled

Martin Walker
Sep 10, 2023 at 09:22 am

Blockchain analysis firm Lookonchain recently raised eyebrows as it flagged a crypto wallet allegedly linked to the Polygon Foundation. This wallet reportedly made substantial transfers of MATIC tokens on the Binance exchange, which, in turn, caused a dip in the MATIC token's value, now resting at $0.5247.Polygon Labs' founder, Sandeep Nailwal, swiftly rebutted these allegations, firmly asserting that there must have been a misunderstanding, and the wallet under scrutiny unequivocally does not have any affiliation with the Polygon Foundation.

Lookonchain identified not one but two wallets, intriguingly named "Polygon Foundation: 0x8d36" and "Polygon Foundation: 0xf957." These wallets, collectively, have poured over $5.5 million worth of MATIC tokens into Binance over the last 30 days, with the intriguing twist that more than half of this sum landed there within the past two days.

Tokens labeled as belonging to the Polygon Foundation were transferred to Binance. Source: EtherscanTokens labeled as belonging to the Polygon Foundation were transferred to Binance. Source: Etherscan  

Caught in the crossfire, Polygon Labs' CEO, Marc Boiron, initially raised concerns about the perplexing issue of wallet mislabeling. It's worth noting that Lookonchain pointed out that the wallets in question had been labeled by another cryptocurrency analytical firm, known as Nansen.

Nansen staunchly defended its labeling protocol, emphasizing the rigorous nature of their process before deeming wallets worthy of a label. They provided a detailed rationale for their label assignment, emphasizing the two wallets' undeniable connections to prominent figures within the Polygon Foundation.

To further underscore their argument, Nansen presented compelling evidence of interaction between Polygon Labs executives and one of the wallet addresses, specifically 0x8d365687a75dc7688864822869ae0551bb6fc105. This included instances such as Polygon's head of growth, Sanket Shah, sending Ether to the mentioned address. Additionally, this address had received tokens from private rounds that Polygon had invested in, including Hot Cross.

As for the second wallet address, 0xf957fa14ea72a9ecd7bdc06c5be89a5a34c7aa89, Nansen asserted that it shared connections with the previous address, 0x8d3, along with other entities closely intertwined with Polygon. One notable example is the head of Investments.

However, in a surprising turn of events, Nansen decided to remove the labels after Polygon Labs' CEO publicly disavowed any ties between these wallet addresses and the company. In response, Marc Boiron expressed his gratitude to Nansen for taking this step and acknowledged the intricate nature of accurately labeling wallets in the world of cryptocurrency.

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