EtherDelta allegedly under investigation in China for “major scam”
EtherDelta almost immediately launched into an irregularity-plagued ICO after changing hands in 2017.
"EtherDelta is involved in a major scam in China, police officially take action against it," said Primitive Ventures cofounder Dovey Wan on Twitter.
According to Wan, EtherDelta founder Zack Coburn sold EtherDelta to a group of Chinese buyers who then used it to launch an ICO for an exchange token called "EtherDelta Token" (EDT).
This may not come as a surprise considering the irregularities which started dogging EtherDelta immediately following its sale, and the explanation EtherDelta's new owners gave users for the token sale.
u know? Zake let me very sad" - EtherDelta
Shortly after EtherDelta was sold, the site was taken down and replaced by an imitation phishing facade, through which over 300 ETH was stolen. Less than a week after that, the EDT ICO was announced, and shortly after that the existing EtherDelta social media went dark, and got replaced by new representatives.
In a since-deleted Twitter exchange from 2018, during which people tried to get a clear explanation of EDT's value proposition, a representative of EtherDelta compared EDT to BNB.
"If we are bacon, BNB in the initial stage maybe is potatoes," the new EtherDelta representative, "EtherDelta Luna" said.
When people said this made no sense, the EtherDelta representative suggested that "maybe u like to eat very much."
Admins in the closest thing to an official EtherDelta Telegram group confirmed that EtherDelta Luna was the new official Twitter account of EtherDelta's new owners.
In other exchanges, the EtherDelta Twitter account seemed to cast around for help from phishing accounts when it was unable to satisfy users, and said that Zack would explain everything.
These details, and many more, were captured for posterity by a lot of confused EtherDelta users at the time.
According to new court filings, the EDT ICO would go on to raise the equivalent of $2.25 million of Ethereum from people who decided they still wanted a piece of whatever EtherDelta was selling.
"FYI, Chinese police show no mercy if any crypto scam involved large amount of retail capital," Wan notes.
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Disclosure: The author holds BNB, BTC at the time of writing.
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