The price of the recently launched Candy token plummeted by 87% following an alleged rug pull by the developers.
According to Etherscan data, on March 6 at 02:30 UTC (04:30 Kyiv/05:30 MSK), the deployment address of the Lena Network liquidity protocol transferred 753.11 ETH, valued at approximately $2.9 million, to the OKX exchange.
This led to a sharp drop in the Candy price from a high of $3.08 to $0.38.
The incident occurred hours before Lena Network announced it was officially renouncing ownership of the token contract.
Important announcement ?
We’ve taken a significant step forward in ensuring our project’s trust and decentralization — we’ve officially renounced ownership of our token contract.
This move is all about fostering a safer and more community-driven environment. Making things… pic.twitter.com/hoxbpszWuR
— LENA ⚡ IFO Launching (@LENA_Network) March 6, 2024
Later, the team issued a statement denying the rug pull.
UPDATE: @LENA_Network RELEASES STATEMENT VIA THEIR MEDIUM RE: RUGPULL ACCUSATIONS
— Funds were transferred to @okx to convert $ETH to but avoid high gas fees on-chain “ensuring capital efficiency and effective treasury management”
— LENA team took further steps to safeguard… https://t.co/A5A3r1nfJt
— BSCN (@BSCNews) March 6, 2024
According to them, the transfer to OKX was made to convert to Ethereum with lower fees to “ensure capital efficiency and effective treasury management.”
For the same purpose, they transferred 100 ETH to the exchange on February 29, immediately after the private round concluded.
“To ensure immediate liquidity of post-token applications on the AMM market, we created a pool approximately 35 minutes before it was publicly announced. This was done to combat sniper bots,” the Lena Network developers stated in a comment to BSC News.
They also claim to have re-pegged the CANDY price closer to its initial setting by converting tokens worth about $35,000 back into USDT and reinvesting them into the pool.
To reassure the community, the protocol team intends to renounce ownership of the token contract, as previously announced.
During the IFO concluded on March 3, the Lena Network team raised a total of over 850 ETH ($3.2 million).
Back in February, developers of RiskOnBlast, a gaming platform on the L2 Blast network, withdrew 420 ETH worth approximately $1.25 million belonging to users, shutting down the website and social media.