Allegations of insider trading have clouded Mystiko Network’s second airdrop, as a few wallets amassed more tokens than regular users. The accusations stem from blockchain reporter Colin Wu’s findings.
The accusations began with an X post from Colin Wu, highlighting suspicious activities involving newly created addresses and large token distributions.
Mystiko Network’s second airdrop is designed to reward holders of the vXZK, an ERC-20 wrapped version of the XZK governance token. The airdrop distribution was based on a snapshot of vXZK balances between June 30 and July 17.
Wu revealed via on-chain data that on July 5, Mystiko-Vault Community Incentives wallet moved 20 million XZK tokens to 1,487 newly created addresses using Multisender, a crypto app.
The new addresses received gas funds from major exchanges like OKX or Bybit just a day after the airdrop. The community suspects coordinated actions favoring insiders, who benefited from substantial token allocations.
The number of airdropped tokens received by these new addresses was notably higher than that of regular users, prompting insider trading allegations. This incident has increased scrutiny on Mystiko Network, especially since it secured $18 million in funding from Sequoia Capital India in March.
Mystiko Network Responds
Mystiko Network issued a statement on X, addressing the community’s concerns and outlining their steps to investigate the matter.
Mystiko stated they launched an internal investigation upon learning about the allegations. The investigation confirmed the existence of the addresses in question and reviewed their transaction history.
The team stressed these addresses met the criteria for early contributors to the ecosystem, having conducted multiple transactions within the network. This marks the second airdrop controversy following the lack of anti-Sybil concerns around the zkSync airdrop.
Mystiko Network has continued to attract over 150,000 users and $276 million in transaction volume since its mainnet launch in March 2023.
