Polygon Foundation Refutes Claims of MATIC Dump on Binance

Following concerns and allegations from the crypto community over a recent revelation from blockchain analytics firm Lookonchain, Polygon founder Sandeep Nailwal has responded to dismiss the claims from the former.

Lookonchain previously flagged two specific wallets which it alleged were owned by the Polygon Foundation, the working group behind the Polygon ecosystem and its native token, $MATIC (set to become $POL in a recent update). This wallet was involved in transferring significant amounts of the MATIC token on Binance.

Nailwal dismissed the claims, asserting that the wallet in question did not belong to the Polygon Foundation and was a case of mislabeling.

One more time, incorrect labelling @lookonchain. This is the second time this has happened.

Plz be careful about these tweets 🙏🏼, creates unnecessary FUDs for the community https://t.co/mVpaIYB9Xt

— Sandeep Nailwal | sandeep. polygon 💜 (@sandeepnailwal) September 7, 2023

The two wallets flagged by Lookonchain were titled "Polygon Foundation: 0x8d36" and "Polygon Foundation: 0xf957". The data revealed that these wallets together deposited over $5.5 million worth of MATIC onto Binance within the last month. Intriguingly, over half of this sum was transferred in just the past two days. Marc Boiron, the CEO of Polygon Labs, was the first to highlight the potential mislabeling issue.

Lookonchain later stated that the labeling was done by another crypto analytic firm, Nansen.

Nansen promptly clarified their stance, emphasizing the rigorous vetting they undertake before labeling any wallets. Their investigations had indicated that the flagged wallets demonstrated strong associations with key members of the Polygon Foundation.

As evidence, Nansen mentioned an instance where Sanket Shah, Polygon's head of growth, sent Ether (ETH) to one of the contested addresses. This address was also the recipient of tokens from private rounds in which Polygon had participated in.

For the second wallet address, Nansen identified its counterparties as having connections with entities closely linked to Polygon, including the foundation's head of Investments.

Despite the presented evidence which Nansen itself opened and discussed, the analytics firm has decided to retract the labels from the wallets. Boiron later thanked Nansen, recognizing the challenges that come with the task of accurately labeling cryptocurrency wallets.

Polygon is a multi-chain scaling solution for the Ethereum network, designed to enhance its throughput and usability by providing a framework for building and connecting Ethereum-compatible blockchain networks. By aggregating multiple sidechains, Polygon transforms Ethereum into a multi-chain system, ensuring faster and cheaper transactions while retaining the security and decentralization of the primary network. Polygon's $MATIC token is currently worth $0.54 at the time of writing, with an average daily transaction volume of $226 million.

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