Lendr Community,
The Lendr team prioritizes transparency, as such we have created this post to explain a recently discovered security/custody event that occurred around our token launch, why liquidity was removed, and what we’re doing next. We’ll share as much detail as we can (legally)and keep this page updated as progress takes place.
Summary of Events
- Lendr created deals with investors to seed initial CEX an DEX Liquidity.
- At launch, there was heavy sell-side pressure that pushed price below launch levels.
- As price fell, many users delayed claiming or processed refunds on launchpads rather than buying.
- The combined effect led to only ~$400 final proceeds from launchpads when Lendr expected exponentially more. (Verifiable on chain: https://bscscan.com/tx/0x16b353008a26d20411373209f949cd1612c85f1d8f897b1c90731eda9bec361f). Screenshots from the launchpads can be seen here:
- Due to the unexpected outcome, our team immediately began a thorough review of other entities involved in the launch event.
- It was discovered that a third-party entity may have acted in an unauthorized and unlawful manner.
- This entity’s potentially unlawful actions created a significant market-integrity threat.
- We informed our private investors who were providing liquidity and they immediately withdraw their liquidity (not Lendr owned funds). We do not fault our investors for making this choice. But unfortunately this has temporarily created an illiquid market on MEXC and DEXs.
Why Was Liquidity Removed?
Our launch liquidity was supplied by private investors.
The potentially unlawful and unauthorized actions taken by a third party could have drained a significant portion of the liquidity. As such, we felt obligated to inform our investors that were providing liquidity in a timely manner, and they ultimately decided to remove their liquidity. This mitigated deeper damage. Unfortunately, the impact of removing liquidity was quite damaging to the token.
Why hasn’t liquidity been re-added?
In order to work on returning liquidity safely, we must ensure that the unauthorized actors no longer pose a threat. Funding will need to be re-secured from investors. We are working with various entities towards this goal.
Is this a rug-pull?
This is NOT a rug pull, this is a non-technical custody/security threat event which we are working to resolve quickly. The Lendr company spent significantly to host the presale and has received almost ZERO funds in return.
For clarity: this event is not related to any technical security breaches in the smart contracts, protocol, or token.
Our goal is to resolve this situation quickly and continue operations of the company and/or bringing our core product to market.
Next Steps:
- Resolve the unauthorized and unlawful custody threat so that it is safe for investors to place liquidity back into the token markets.
- Our top priority is to find resolution and move forward as soon as possible.
- We will continue to transparently keep the community updated with new developments that we are allowed to share.
- Thank you, we are working tirelessly to resolve this situation.
Update:
Based on on-chain analysis and digital forensics, we’ve identified potential irregularities around presale/launch activity by a third party that appear inconsistent with credible industry standards and venue policies. We have retained external counsel and are pursuing appropriate legal remedies. We will provide concrete updates where possible with new developments.
