Summary
The team behind Tellor, a protocol providing oracles for smart contracts, is facing accusations of market manipulation after the price of its TRB token skyrocketed 172% in a day before quickly plummeting. Data providers flagged that a small group of whales held a large portion of TRB’s supply and accused them of creating a pump-and-dump cycle. On-chain analytics firm Lookonchain also flagged that the Tellor team deposited $2.4 million worth of TRB to Coinbase near the peak of the pump, suggesting their involvement in the alleged scheme. Synthetix, a veteran DeFi project, incurred $2 million in debt as a result of the market action. The losses were suffered by Synthetix stakers. Omer Goldberg, founder of Chaos Labs, suggested that the incident could have been avoided if the open interest limits were set using a value in fiat currency rather than TRB tokens. Synthetix v3 is currently under development, which may slow down the progress of upgrading v2.
Key Points
1. The price of Tellor’s TRB token experienced a significant increase of 172% in a single day, followed by a rapid decrease within one hour. This market volatility has led to accusations of market manipulation against the Tellor team.
2. On-chain analytics providers flagged that a small group of whales held a large portion of TRB tokens, accumulating them at a favorable price and slowly depositing them onto exchanges. This behavior has been seen as a pump-and-dump scheme to liquidate their holdings.
3. Lookonchain, an on-chain analytics firm, discovered that the Tellor team deposited $2.4M worth of TRB to Coinbase near the peak of the token’s price increase. This suggests possible complicity in the alleged pump and dump scheme. The market volatility caused losses for Synthetix stakers, resulting in approximately $2M worth of debt.