Last week, Sam Thapaliya, Founder of Zebec Protocol, made headlines in a scandal that drew attention from the entire blockchain industry. The CoinDesk report by Kessler alleges that Movement Labs granted a secret middleman the ability to unilaterally sell $38 million in MOVE tokens, a decision that shocked stakeholders and experts in the industry, raising questions about internal oversight:
Foundation officials initially flagged the Rentech deal as "possibly the worst agreement."They had ever seen; experts warn it created incentives to pump MOVE's price before dumping tokens onto retail investors.
Former CEO Rushi Manche has been terminated from Movement Labs, and according to CoinDesk, what remains of the Movement Labs entity is investigating Sam Thapaliya's involvement. Thapaliya was allegedly CC'd on leaked emails from the malicious market maker to the Movement team.
"My understanding is that he is a close advisor to Rushi and perhaps sort of a shadow third co-founder," said one employee.
Through a pseudonymous account, Rushi Manche later leaked the documents that demonstrate entity in the Cayman Islands advised Movement on market makers:
Further details have yet to come to light.
The market maker entity, which is now banned from the Binance exchange, was created by Galen Law-Kun, Thapaliya's business partner. Law-Kun is quoted in the article defending the highly unusual market making agreement. YK Pek, who Galen Law-Kun claims is his lawyer, denies representing Law-Kun and says that he is "disturbed" by the claim that he is Law-Kun's general counsel.
Industry Leaders Condemn Sam Thapaliya
Prominent members of the industry commented onalleged role in particular. Users described themselves as victims of Thapaliya's alleged "Zepoch" incident, presumably a token sale which was subsequently delisted in Korea. The specifics of the Zepoch episode remain murky, and no formal wrongdoing has been established:
In a now-deleted post on X, Mike Dudas, co-founder of The Block and 6th Man Ventures, says that is the only founder that he ever asked for his money back from, citing a plagiarism scandal where allegedly copied Streamflow's source code for his own project, Zebec. Vijay Chetty, CEO of Eclipse Labs, posted on X that company Zebec filed a lawsuit against Eclipse Labs, which was later dismissed.
NoSleepJon, a representative of the bridge provider Hyperlane, added: "Sam Thapaliya should not get away with another one."
Multiple accounts on X have reported that mentions of Thapaliya are supposedly "botted," a tactic that involves fake engagement on posts in an attempt to suppress their reach, such as this post which received 2,000 likes, but only 4 retweets:
The Movement Labs investigation remains ongoing, and the industry continues to monitor developments closely. The allegations against Sam Thapaliya have not been proven in court, and Thapaliya has not publicly responded.
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