- The US Department of Justice is investigating a team of two brothers behind Saber, a Solana-based decentralized exchange.
- The investigation follows Ian and Dylan Macalinao and their 11 pseudonymous identities that built an ecosystem of interlocking financial products.
- The protocol developers edited the Total Volume Locked on Solana based projects, causing billions of dollars of funds to be double-calculated multiple times.
The US Department of Justice (DOJ), a federal executive department of the United States government, is investigating a team of developers associated with Solana-based protocol Saber. The duo is accused of falsifying identities and inflating Total Value Locked statistics, a metric that is used to measure the overall health of a DeFi protocol.
US Department of Justice investigates decentralized exchange on Solana blockchain
The US Federal Law enforcement agency, the Department of Justice is currently investigating Saber Protocol, a decentralized exchange on the Solana blockchain network. Saber facilitates stablecoin swaps on Solana and functions similar to the Curve protocol on the Ethereum blockchain. The DEX allows for low fee swaps of USD-based stablecoins.
The duo of developers behind the Saber Labs, Ian and Dylan Macalinao are currently under investigation by the DOJ. The brothers are accused of creating a web of false identities and an ecosystem of interlocking financial products that double and triple counts crypto deposits by exchanging tokens within itself.
Total Value Locked is a key DeFi metric that measures the total value of all assets locked, including all deposits in all the functions that the protocol offers, including staking, lending, and liquidity pools. The falsification of identities created a tangle web of products within the ecosystem that boosted TVL for Solana by billions of dollars during the height of the crypto market’s bull run in 2021.
The investigation has revealed protocols that are stacked on top of each other to inflate TVL, including yield-farming app Sunny Aggregator, and stablecoin Cashio.
The stablecoin exchange remains operational, handling a 24-hour trade volume of $39,018. As the DOJ pursues the investigation, the Solana blockchain network and its native token SOL continues to yield gains for holders in the ecosystem.
SOL has yielded nearly 70% gains for holders of the Ethereum-killer token, in the last two weeks, riding the wave of altcoin price rallies in 2023.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.