As the dust settles after a wild scandal rocked the world of decentralized finance (DeFi), questions remain for one “magical” altcoin caught in the crossfire.
Earlier this week, a self-professed “on-chain sleuth” took to Twitter to claim that the chief financial officer of crypto protocol collective Frog Nation is Michael Patryn.
Patryn is the former co-founder of defunct cryptocurrency exchange QuadrigaCX, which reportedly lost $169 million of investors’ money.
The pseudonymous zachxbt says,
“@0xSifu is the co-founder of QuadrigaCX, Michael Patryn. If you are unfamiliar, that is the Canadian exchange that collapsed in 2019 after the founder Gerald Cotten disappeared with $169 million.
Prior to Quadriga, Michael helped run an identity theft ring called Shadowcrew in which he later pled guilty to [under his previous name Omar Dhanani].”
Crypto insights firm Santiment explains the gravity of the revelation by noting that the Frog Nation collective’s treasury is currently valued in the nine-figure range.
“Frog Nation is a collective of projects which work together to push DeFi and the overall crypto industry forward.
Currently consisting of Abracadabra.money, Popsicle.finance, Wonderland.money and the most recent member, Sushi.com.
With all the negativity around the Frog Nation, it’s no surprise that all associated projects have been in the red (it’s made worst when we are in a crypto bear trend).”
Santiment focuses on how Spell Token (SPELL) has been impacted. SPELL is an Ethereum (ETH) token that governs the Abracadabra.money platform where users deposit interest-bearing crypto assets to mint the stablecoin Magic Internet Money (MIM).
The analytics firm says,
“Given the huge amount of volume we are seeing, it sure looks like every SPELL holder is trying to drop it like it’s hot.”
Despite the sell-side pressure, Santiment thinks SPELL can survive the storm as long as king crypto Bitcoin (BTC) maintains current price levels.
“SPELL’s MVRV 7D [market cap/realized cap over 7 days], which measures the short-term profit/loss of holders, is showing that we are still safe from the danger zone, as all short-term holders are at a loss at the moment, which may leave us some room to go before risk is increased significantly.
That said, if BTC continues to dump, it’s highly unlikely SPELL will hold its ground.”
As for the road ahead, Santiment says in a tweet that Frog Nation is weighing the possibility of ousting the embattled Patryn.
“Through pressure these past few days, Daniele Sesta (the brainchild behind Frog Nation) put up a poll as to whether 0xSifu should be removed.
Currently, 85% are saying to replace Sifu and almost 15% are saying to keep Sifu.”
Spell Token has experienced a steady price drop this week, falling from a Tuesday high of $0.0094 to its current valuation of $0.0056.
Bitcoin is up slightly on the day and exchanging hands for $37,671.
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Featured Image: Shutterstock/FlashMovie/Nikelser Kate
