Chinese police probe spurs mysterious token movements and platform upgrades

Filecoin (FIL) liquid staking protocol STFIL claims that there have been token movements and unexplainable protocol upgrades following an investigation of their team members by the Chinese police. 

On April 9, the protocol expressed their belief that Chinese authorities are still investigating their core technical team members. According to the X post, the detained members have already received legal assistance. They wrote:

“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.”

The liquid staking protocol also said that while their team members were detained last week, FIL tokens on the STFIL platform were transferred to an “unknown, external address.” At the time of writing, the address holds 2.5 million FIL tokens worth about $23 million.

Furthermore, STFIL also claimed that there were “abnormal, unscheduled upgrades” in the past few days within the protocol amid the investigation.

The staking platform said they are seeking assistance and urged the community to help monitor the address that received the tokens. “We hope that the community can help track this unknown address and discuss ways to protect the interests of stakeholders,” they wrote.

Community members on X claiming to have staked their FIL tokens on the platform have been discussing how they could recover their funds. Some have questioned how the police can take over funds.

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Meanwhile, the Filecoin token remains strong despite the issues. On April 9, FIL recorded a 7-day high of $9.32 and had a 24-hour volume of $265 million.

Currently, the token hovers at $9.12, according to coin information tracker CoinGecko.

This is not the first time Chinese authorities have cracked down on crypto projects. In 2023, cross-chain protocol Multichain announced that it was forced to halt its operations due to a lack of funds.

This happened after its CEO and co-founder, Zhaojun He, was taken into custody by Chinese police. With information scarce, the project had no choice but to wind down activities.

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