Trapped Between Protocols

Roughly $32 million sits frozen in smart contracts while Alpha Finance plays musical chairs with company names.

Their first rebrand to Stella failed to wash away $32 million in bad debt.

Their second attempt as LitLayer leaves users staring at immovable balances - forever visible on-chain, forever out of reach.

Through it all, Iron Bank holds user deposits hostage, demanding payment for a 2021 hack that started this death spiral.

Their team blocks whistleblowers, ghosts creditors, and builds fresh empires while their old kingdom burns.

When did changing your name become crypto's favorite getaway car?

February 2021: A phantom exploiter bleeds Alpha Finance for $37.5 million, targeting an unannounced pool contract like a thief with inside keys.

The move bore all the hallmarks of an inside job - targeting an unreleased feature known only to insiders.

In the aftermath, Andre Cronje steps in as DeFi's dealmaker. A repayment plan emerges: Alpha pledges 20% of protocol fees and posts $109 million worth of ALPHA tokens as collateral.

The agreement lives on-chain, unsigned by either party - a detail that would prove crucial.

Iron Bank accepted what will prove to be a devil's bargain - they can't liquidate the collateral without Alpha's permission.

The debt payments trickled in at $5,000 per month while ALPHA's token price cratered 90%.

Alpha's team tokens vest on schedule - no restrictions on their personal selling as their protocol's debt goes unpaid.

By early 2023, Iron Bank demands more collateral.

Alpha's answer? Two weeks of silence, one stalling meeting request, and a plot twist - their own lending market launches, a middle finger wrapped in smart contracts.

This is the point where Iron Bank's patience shatters like a broken multi-sig.

Without governance approval or community input, they unilaterally change their smart contract code.

Alpha Finance gets two days notice - barely time to warn users before their funds freeze solid.

The collateral damage spreads far beyond the original debt.

User deposits that should have nothing to do with Alpha's obligations, now they have become hostages in Iron Bank's vaults.

A protocol-to-protocol partnership turned into a digital hostage crisis.

Alpha Finance's next move was to write their eulogy.

Instead of fighting for users or facing their creditors, they choose Door Number Three: sleight of hand.

Alpha emerges as Stella, hawking fresh yield farms while their old users howl into support ticket void.

Months pass under this new mask - same team, new logo, zero accountability. But even star-bright brands fade.

The original hacker, meanwhile, stirs from their slumber.

August 2024: The original hacker stirs from their crypto winter.

500 ETH slithers through Tornado Cash - a phantom profit finally finding its escape route.

The team's response? A whispered tweet from their account's graveyard of 11k followers.

Fast forward to November 2024, the hacker moved another 250 ETH to Tornado Cash.

Meanwhile Alpha Finance is playing shapeshifter again, as Stella is looking to rebrand as LitLayer, another costume change in this cringey masquerade.

Users face a devil's choice: pray for mystery repayments or swallow a 10% loss to taste freedom.

Today, Iron Bank's own website lies dead, their once-mighty protocol withered to $19 million in TVL - with no gameplan in sight to release the user funds caught in the crossfire of Alpha's unpaid debts.

Users stare at worthless ibTokens - claim tokens of claim tokens, a Russian doll of broken promises.

In DeFi's game of musical chairs, who pays the price when the music stops and the founders keep dancing?

DeFi sold trustless dreams but shipped trust-required nightmares.

Smart contracts become digital prisons for user funds while founders swap Twitter handles like burner phones.

Iron Bank weaponized their contracts while Alpha abandoned their users - two protocols writing the playbook on how to fail your community.

The Rebranded Protocol teams toasted champagne with Binance suits at Token2049 while their users look at dead frontends.

No regulators breach Bangkok offices, no investigators chase digital breadcrumbs - just another rug wrapped in blocked Discord accounts and broken Medium posts.

Rebranding: the gentleman's rug pull - slower, smoother, dressed in Figma-fresh logos and medium.com promises.

Teams simply shed their skin like digital serpents, emerging clean while their victims remain trapped in the old shell.

The ecosystem watches, shrugs, and moves on to the next shiny protocol.

Who the hell holds people like this accountable?

Why chase accountability when you can just change your name?

REKT는 익명 작성자들에 의한 공공 플랫폼이며, REKT에 작성된 관점이나 내용에 대해서 그 어떤 책임도 지지 않습니다.

기부 (ETH / ERC20): 0x3C5c2F4bCeC51a36494682f91Dbc6cA7c63B514C

disclaimer:

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