Creator of Yearn Finance faces lawsuit – YFI price under pressure

  • The victims of the EMN theft have launched a crowdfunding campaign to sue the inventor of, Andre Cronje.
  • In response to the accusations and even death threats, Cronje tweeted on October 9th that he is “still building”, however, wants to stay away from social media.

In late September, a vulnerability on Ethereum DeFi project called Eminence allowed a hacker to steal $15 million. While the project’s developer Andre Cronje, known for creating the Yearn Finance protocol, claimed that Eminence was still in a test phase, investors rushed into the new project despite the warnings. A group of victims, however, does not want to settle for that and have organized itself to hold Cronje and other suspected partners accountable.

According to a publication on Medium, those affected by the Eminence case have started a crowdfunding campaign. They have asked supporters to donate ETH to an address they have set up to “create a new DeFi ecosystem without the bad actors”. The EMN Investigation group allegedly wants to act on behalf of the victims of the theft and emphasizes in its publication that all funds will be used to fund the lawsuit.

The campaign will run for one month with a start date of October 9, 2020, and will therefore end on November 9 at 23:59 UTC. A reward has also been announced for campaign participants:

As a way to thank you for your donation, we will take a snapshot at the end of the crowdfunding campaign, and airdrop 50% of the supply of a fork of YFI to donators. The other 50% of the supply will be airdropped to the victims of the EMN scandal.

Facts that led to the theft of $15 million

Eminence is a project conceived for the video game sector. At the time of the launch, Cronje reiterated that his development process consists of deploying the products on the Ethereum mainnet. Many times, according to the developer, the products have issues. Therefore, he warned users to be cautious.

However, the EMN Investigation account presented a new timeline of the facts starting with Andre Cronje “creating hype” about Eminence and then, with the deployment of the contracts and their publication on the developer’s Twitter account “while the liquidity was flowing” to them.

In addition, “Yearn Finance’s head of communications”, BlueKirby, allegedly promoted the contracts and gave instructions on their use while a Yearn Finance developer named Banteg “sold tokens from the contract” to the Uniswap exchange. After the robbery, the attacker returned $8 million to Andre Cronje without offering any reason, as the EMN Investigation concludes:

If EMN was a test, it had zero value as a token. Yet Andre watched as $15 million poured in without a word. But kept hyping the project by retweeting. Why didn’t he at least warn the Yearn Finance team that they were buying and selling a worthless test token? If developers from any other team started hyping and selling a test token, they would be accused of fraud and the entire team would lose legitimacy. At best, this was a viral launch gone bad, at worst, it was a rug pull.

In response to the accusations and even death threats, Cronje tweeted on October 9th that he is “still building”, however, wants to stay away from social media.

Meanwhile, the price of the governance token YFI has been negatively impacted.  At the time of publication, YFI is trading at $16,293 with a 5.14% loss in the last 24 hours. In the weekly and monthly charts, the token shows a sharp correction of 13.76% and 51.53% respectively.