Oyster Protocol developers will restart after theft of $ 300,000 by the founder of the project

The little-known Oyster token (PRL) rose on Friday, November 2, by more than 1,300% as a result of suspicious transactions on the Coinsuper exchange and a halt in trading at other sites. This was preceded by a scandal erupted around the project, in which its founder and chief architect of the system Bruno Blok plays a key role.

A few days ago, he said the current head of Oyster Protocol William Cordes, Bruno unit used backdoor into a smart contract and awarded approximately three million tokens PRL. After that, he transferred these tokens to the KuCoin exchange and sold them for $ 300,000.

“We found that the transferDirector function used in the Oyster Protocol smart contract was used. This feature allowed him to re-launch ICO PRL and re-issue tokens (1 ETH = 5000 PRL / .04 per PRL), ”says a project blog post of October 30th.

As William Cordes explains, even though the smart contract went through three independent checks, Bruno Bloch insisted that they could be managed from any address.

“This contract was written by Block himself especially for this ICO at the time when he was the only member of the team. Bruno was the only one who could change the owner of the contract within the framework of the contract itself. After our analysis, we are inclined to believe that it was Bruno Block who did this in order to circumvent the KYC procedures that KuCoin launches on November 1, ” added Cordes.

According to an internal investigation, after the creation of tokens, they were sent to the exchange and exchanged for BTC and ETH. Neither the Oyster team nor the Exchange staff managed to stop the transactions, since everything happened in 6 hours.

The Bitcoin address associated with these transactions received 22 transfers for the total of 70.73449286 BTC in one day. Also listed is the Ethereum address , the last four major transactions for which were 186, 175, 177 and 515 ETH.

All these events took place on October 30, and as Cordes emphasizes, it was an extremely carefully planned operation on the part of Blok. In particular, he not only carried out all the transactions before the introduction of KYC procedures at KuCoin, which resulted in a limit on withdrawal of funds in the amount of 2BTC daily was introduced for unverified users, but also did so at a time when most of the stock exchange employees were offline.

Two days later, on November 1, Bruno Blok contacted William Cordes. Screenshots of their correspondence in Telegram were also posted on the project blog.

In the conversation, Blok admits to stealing money and explains this, among other things, by dropping the Ethereum price from $ 1,200 to the current $ 200. Also, citing Tether as an example, he states that the entire cryptocurrency industry is a huge financial pyramid, and Bitcoin will cost $ 20 very soon, and Ethereum will return to $ 5.

According to him, he wanted to hire more people to develop the project, but because of the market decline, he could not do it. He also accuses Cordes of insider trading and states that he is fired, and finally tries to justify his actions once again, speaking of the desire to protect his wife and children from the inevitable financial collapse that could happen any day.

In parallel with this, Blok once again accused Cordes of insider trading, this time in the now remote official project channel in the Telegram.

"Attention everyone …
Then William told the team that our tokens would be traded on Binance. From that moment the problems started. The price soared from 2 to 26 cents. I spoke against the trade in tokens, but he didn’t care. I did not allow him and his friends from venture capital funds to bastard you and spoiled him myself, ”wrote Block.

Cordes, in turn, said that the project is going to submit an application to law enforcement agencies, is actively working with lawyers and has already hired a private detective.

The project team also launched new Telegram channels through which communication with the community is now maintained.

Please note that all new telegram channels are: https://t.co/jP6V3lAFvX and https://t.co/TMc1TmGNvv #deltadirect

– Oyster Protocol (@OysterProtocol) October 31, 2018

The events continued on Friday, November 2, when the price of PRL unexpectedly rapidly went up, in a few minutes rising from $ 0.028 to $ 0.051. In this case, the reason for this was the unusual activity on the Coinsuper exchange. Trading on other exchanges where PRL is present, including KuCoin, had already been suspended.

The weighted average rate of PRL, according to CoinMarketCap , has increased by 1335.93% in the last 24 hours.

At the same time, on the Coinsuper the same indicator was + 1674.05%

The Oyster team almost immediately responded to what was happening, saying that these were fake volumes that were not related to the project. The project representatives also contacted the Coinsuper administration, and the PRL bidding on this site was soon frozen.

In the future, it is planned to restart the project. To this end, the developers plan to take a picture of the blockchain at the time of stopping the bidding on KuCoin and roll back the story by this point.

Also, according to the announcement on Reddit , on November 5 and 6, project developers will hold a question and answer session, during which they will answer all questions of interest to the community.

The Oyster project is designed for site owners and allows them to earn income for storing files. The service works on the basis of technology IOTA Tangle. Users provide their computing power instead of viewing ads.

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