Everyone - I screwed up. Big time.
I am going to own up to all my mistakes here and cover how I plan to fix things.
TLDR: I made many mistakes. I have arranged compensation of more than what was extracted by the KOL marketing scammer & trading losses incurred. Total losses are estimated at $56,950.78 and compensation is estimated at $68,340.94.
The KOL manager I have worked with had been driving things behind the scenes with us for the last few months, pushing us towards a token launch that ultimately ended up being a pump & dump exit orchestrated by him. After the launch, he blocked me on Telegram and deleted all his messages. Now I understand his actions better in hindsight.
Let me transparently share everything that happened here.
By focusing too much on marketing and chasing hype, I ended up making several mistakes.
- I put my trust in a KOL manager who worked with me for several months.
- He worked with me on different areas from project development to token launch.
- Rewarding the KOL Manager for his hard work. I made the decision to grant him 0.5% of the token supply, 100% liquid (BIG MISTAKE)
He created a pump & dump at the start. That is not what I wanted. I was rushing a token to market. Instead, I should have just focused on product development, and not count on KOL marketing.
Apart from the above, there were other mistakes made, and I want to be fully transparent with what happened.
I had intended for 25% of the token supply to be for the airdrop to $DTF holders. This was held at the following address: https://solscan.io/address/HyhQELM4RnK3o2vJqAsQsXwEiW5nW8REGDrcFNWM51oi
Firstly, the KOL manager received 0.5% of the token supply from the airdrop address to his address here: https://solscan.io/address/Fof6Vk6fWhU5iKGWzw2RPSKbKNxpFGe6ufxiVszVZuRz
He sold everything. He extracted 281.978562845 SOL, which he swapped for 40,425.731886 USDC and sent it out to 3 addresses:
After all this, he deleted his contact details. Painful lesson learnt - but I will cover all losses.
Secondly, our CTO received 0.4% of the token supply from the airdrop address to his address here. https://solscan.io/address/FyvheU2DJKM8R2La2Vkgig3Z8pk5dSSsSUoQnvrS2cVN
Our CTO sold 4,000,000 FRNX, which is 10% of his holdings at that time (0.04% of the token supply). Even though he then bought it back later, it is still WRONG. He extracted 9870.259609 USDC across 4 transactions. His net extraction was less as he bought it back, but the number above cites the absolute value of his sales.
Thirdly, as for myself, this is my private address https://solscan.io/address/AfirzAntKWLt5ik6zPsiZMSZjPjZEyPgwpavjYATSU94 As is evident from the blockchain, I had transferred 1% of the token supply from the airdrop address to this address. This was a mistake (I should have sent it from my team address). I haven't sold any tokens and have returned the tokens to the airdrop address.
I acknowledge that the negative impact due to these mistakes is immeasurably larger than the sums extracted above.
COMPENSATION: MY ATTEMPT AT MAKING THINGS RIGHT
To make things right, I am taking a loan to provide total compensation of 400 SOL, 10,000 USDC and 10,000 VIRTUALS to anyone affected during this fiasco.
It has been funded with the amounts as mentioned above. These funds will only be used for compensation and nothing else.
Compensation transactions can be viewed here.
I will set up a claim process so that anyone who incurred trading losses will receive back 1.2x (extra 20%) of whatever was spent.
That is the principle behind the compensation.
I will work out cases where you may have bought and sold multiple times during this period, but my intention is to give you a claim of 1.2x (20% extra) of whatever was spent in net terms.
If anyone’s compensation is less than $140 in value, we will give you 1 SOL regardless. It doesn’t matter if the realized/unrealized loss is $0.01 or $100.
This compensation doesn't forgive the mistakes we made, but I hope you allow me to reset things and move forward.
I have accepted the apology of my CTO - his actions are also on me for my lack of supervision and control.
TO MY PARTNERS, I AM SORRY
Our partners, Confusion Capital and Cambrian Labs, supported us with funding. They trusted their capital with me to support my vision.
They were not aware of the actions of the KOL manager, nor the actions of my CTO and myself. TO THEM, I AM SORRY.
Despite this mistake, I hope to continue to have their support. I have reached out to explain what happened. They have expressed their extreme disappointment with me about the events that have occurred.
However, they will continue to extend funding to us to support further development of the protocol, including supporting developers intending to build applications on top of the Franklin X Protocol. They will also help extend a loan to us to cover the compensation.
This is provided that we focus mainly on product development & real revenues going forward, with extremely limited marketing expenditure to KOLs or marketing agencies. I promise to not solicit any marketing support from my partners either, until I have proven & grown my product revenues and repaid the loan in full. I have committed my team to this.
We will be driven by product development, and not by KOL-led or external marketing. I will let the product and its revenues speak for itself. I am so sorry.
Thank you for your continued support, if you would still give it to me.
If you don't, I understand. I will work to earn your trust in the days ahead.
I will keep on BUILDING.
Compensation can be followed here, live: https://franklinxprotocol.ai/blog/compensation
Yours sincerely,
MemeIndexer
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