Concerns over a potential "slow rug pull" have emerged within the LENX community as unexplained transfers of treasury assets worth millions raise suspicions.
Mysterious Withdrawals Trigger Alarm
Rumors have swirled on social media about possible malfeasance at LENX, a liquidity protocol, following reports of significant token transfers by its founders to a Binance account without clear explanation, leading to speculation of a slow rug pull.
Founders Under Scrutiny
Founders John Kim and an individual known as Paul are at the center of controversy after allegedly moving over $10 million from LENX's treasury. The lack of communication post-transactions has only fueled the community's concerns, with users reporting deletion of inquiries on Discord.
BREAKING 🚨@LENX_Finance's Founder (John Kim) has allegedly cheated the team, running off with over $10,000,000 in stolen funds and transferring them to Binance.@fraxfinance has doxed him, his identity is public knowledge. I will need your engagement to bring this case to… https://t.co/7qShTX8JUh
— AstroBoy🔮🉐 (@fevrdad) March 27, 2024
Impact on LENX’s Market Value
Since its launch in January 2024, LENX has promised innovative yield generation using native Bitcoin. However, the value of its native token, LENX XD (XD), has plummeted from $0.26 to $0.02, reflecting the growing uncertainty around the protocol.
Responses and Investigation
Despite attempts to contact LENX Finance co-founders and the associated lending protocol FRAX Finance, responses have been sparse. Co-founder Kim has remained tight-lipped, while Paul has indicated efforts to investigate the suspicious transactions.
Measures to Safeguard Assets
Reports from the LENX Discord server suggest that efforts to freeze the involved Binance account have successfully protected $3 million. Legal investigations are ongoing, particularly concerning Kim's actions, with Paul purportedly cooperating.
Broader Context of Crypto Scams
This incident highlights the increasing prevalence of crypto-related investment scams, with the FBI noting a significant rise in losses to such frauds in the United States, underscoring the need for vigilance in the crypto investment landscape.
