Chinese authorities are investigating the Filecoin-based STFIL protocol, with some of its technical team members currently in custody, according to project representatives.
We believe that the STFIL core technical team is under investigation by local Chinese police, and we understand lawyers have been hired to understand the current situation and provide legal assistance to the individuals under detention.
Last week, when the core technical team…
— STFIL Protocol ?️ (@stfil_io) April 9, 2024
The reason for the investigation remains unknown. The team is seeking legal counsel to secure the release of their colleagues.
They also reported that 2.5 million FIL ($22 million) were moved from their platform to an external address last week, while key technical team members were detained.
“The assets were transferred amidst unscheduled anomalous protocol updates,” project representatives added.
The STFIL team has reached out to the community for assistance in tracking the funds and safeguarding their interests.
At the time of writing, the TVL of the STFIL protocol stands at $39.5 million, having dropped nearly 60% since the beginning of April, according to DeFi Llama.
In August 2023, Chinese prosecutors accused the mining company Shenzhen Shikongyun, which mines Filecoin, of running a Ponzi scheme involving 606.9 million yuan (~$83.3 million).