Tragic Loss: Trader Claims $1 Million Worth of Cryptocurrency Lost in 0L Network Hard Fork
In a devastating turn of events, a trader known as NN has allegedly lost more than a million dollars’ worth of cryptocurrency due to an unauthorized hard fork on the 0L Network. According to a post on X, the pseudonymous trader revealed that they had purchased 147 million Libra tokens in February 2023, which were valued at around $1.47 million at the time. NN had joined the protocol to assist with marketing efforts.
Since May 3, the value of Libra has plummeted by over 58%, trading above $0.001 as of 12:35 pm UTC, according to data from CoinGecko. The decline in value has only added to the trader’s significant financial loss.
NN claims that the team behind the 0L Network was already aware of a bug that had been present for over two years, with certain insiders taking advantage of it. However, the team chose to disregard the issue, citing the lack of value of the Libra token. The trader expressed their frustration, stating:
“The team had full knowledge of this bug for a long time and insiders were exploiting it. But they simply ignored it because they believed the Libra token was worthless.”
The hard fork occurred as a result of a smart contract bug that allowed insiders to unlock vested tokens at a faster rate by distributing them across multiple wallets. Shockingly, this loophole still exists in the latest version of 0L Network, v7, according to NN.
Rather than addressing the loophole, the team opted to fork out all the wallets they believed had taken advantage of it. Unfortunately, this decision had unintended consequences for innocent users, as it was impossible to trace all the affected tokens. NN shared their frustration, saying:
“I bought tokens from multiple validators, but my wallet was still forked out because of one validator that the team deemed rogue. They were fully aware that innocent wallets would be affected.”
The trader also revealed that other victims had been mistreated and expelled from the Discord group associated with the project. The situation has raised concerns about the transparency and fairness of the 0L Network.
In an intriguing twist, several validators suggested that the pseudonymous lead developer of 0L Network, known as 0D, could be Lucas Geiger, the founder of the OpenLibra project. Geiger has a history of legal troubles, having faced charges from the United States Securities and Exchange Commission for fraudulent behavior.
Geiger is also the co-founder of Wireline, a project that raised $20 million in March 2018 for a decentralized peer-to-peer developer and business network. However, despite the successful fundraising, the network was never developed, and the promised WRL ERC-20 tokens have yet to be distributed to investors. In January 2021, Wireline was fined $650,000 by the SEC for an unregistered securities offering and alleged fraud involving its subsidiary, Wireline Developer Fund, based in the Cayman Islands.
The incident has cast a shadow over the 0L Network and has sparked discussions about the vulnerability of decentralized platforms and the need for stronger security measures.