cryptoslate.com
Cross-chain protocol Stargate Finance has initiated a proposal to reissue 1 billion $STG tokens, following concerns that Alameda’s wallet holding 10% of the token supply has been compromised.
During Stargate’s public sale on March 17, 2022, Alameda Research purchased 10% (100 million) of the total $STG supply, with a commitment to lock up the tokens until March 2025.
In the wake of the recent FTX collapse, Alameda’s wallet was reportedly compromised. On Dec. 28, 2022, Arkham Intelligence flagged a malicious actor that had transferred over $1.7 million from Alameda’s wallet via several crypto mixers.
The malicious hack against Alameda has raised concerns that all tokens, including locked-up $STG, may be stolen and dumped into the market.
Consequently, the Stargate DAO has proposed to reissue all $STG tokens to avert the bad actor claiming the tokens and dumping them into Stargate’s liquidity pools.
“Without a token re-issuance, a malicious actor with access to Alameda’s private keys could claim the Stargate tokens from the contract as they vest and misappropriate them.”
As per the proposal, Stargate will execute a snapshot on March 15, 2022, and reissue the new $STG tokens to existing holders on a 1:1 basis.
Twenty-four hours before the snapshot, all exchanges and pools supporting $STG will pause deposit and withdrawal requests. However, trading will be reinstated once the token re-issuance is completed.
The token re-issuance will ensure that Alameda’s 100 million $STG holdings are not stolen and dumped into the market.
In addition, the Stargate Foundation said it would create a new multi-sig wallet to safeguard Alameda’s tokens pending the outcome of the trading firm’s ongoing bankruptcy process.
Stargate’s native token ($STG) has surged over 21% in the last 24 hours and is up by 96% over the last 30 days, according to CryptoSlate data.