Elan

On August 3, 2022, Elan launched its token on the ERC-20 Blockchain, airdropping 3.6% (for free) of its total projected supply for large scale #blockchain testing and generating awareness of their products.
Fast forward to October 25th, 2022: $ELAN was listed on #BitMart to facilitate access to its #token to people around the world.
Elan was asked to provide 10,000 $ELAN for marketing purposes (Trading Competition and Buy&amp;Earn activities). See transaction below.
<a href="https://etherscan.io/tx/0x17b8ecb906d9794175ad6b6d8cb593c5dd2a3f1ebb410fa91f4e55d41aff1f25" rel="noopener noreferrer nofollow">https://etherscan.io/tx/0x17b8ecb906d9794175ad6b6d8cb593c5dd2a3f1ebb410fa91f4e55d41aff1f25</a>
Time went on and the launch seemed successful. It was business as usual until Twitter user @dukhanzen messaged Elan's CEO, @JeromeKnowsBest, on January 2nd, 2023. They explained that the trading competition rewards had not been distributed—two months post-competition.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/c6bc1146f42a4b5a9e113ace319235d3.jpeg">
Elan immediately began an on-chain investigation of all transactions to and from BitMart wallets, scouring through the blockchain data for any irregularities to make sure no tokens funds were being misused by the exchange while Elan kept a watchful eye over wallet activity.
On January 31, 2023, BitMart's wallet sent a transaction of 15 $ELAN to @WhiteBit
Deposit Address: 0x366588863a6367927d3e3980ce3489e3a69097bb
<a href="https://t.co/6XQHcbZjH7" rel="noopener noreferrer nofollow">https://etherscan.io/tx/0xb0224e313c89d5d178792e811289a3747acef963ba8c8d58a30f296a875eb65f…</a>
Nothing too unusual—people send tokens to exchanges all the time but the very next day, the same BitMart address sent an astonishing 35,985 $ELAN to the same WhiteBIT deposit address. This is highly unusual behaviour and raised questions of potential malicious activity.
<a href="https://etherscan.io/tx/0xbe8331c3fdd13d8037862803008f44a5f2f8ea5ce4efd95d1f648ea591ada698" rel="noopener noreferrer nofollow">https://etherscan.io/tx/0xbe8331c3fdd13d8037862803008f44a5f2f8ea5ce4efd95d1f648ea591ada698</a>
$ELAN Holders began to take notice as two large sell orders were listed on @WhiteBit Exchange.
The Elan Future team was also quickly contacted by concerned $ELAN holders, who wanted the team to be aware of this sudden influx in selling pressure. Elan was already on the case.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/15bfa57ea90c455493efa5f32ace1ec9.jpeg">
On February 1st, Elan's CEO contacted ChadBitmart on Telegram to investigate suspicious transactions. Elan noticed 19k tokens in the BitMart wallet while Jerome's BitMart account showed 21k tokens. What could explain this discrepancy?
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/69bd4298660d440c85e2b401dae44100.png">

The exchange should have enough tokens to match their users' holdings. Not just Jerome's, but hundreds (if not thousands) of other token holders too! Something was definitely off here...
ChadBitmart told Elan's CEO that BitMart had more than one wallet. @JeromeKnowsBest then asked for those to be provided in order to verify the BitMart representative's claims, to which the rep declined, stating they weren't supposed to be shared with the public.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/2680ce0cf56946ec971dac729bc6fe43.png">

#BitMart ended up providing their wallet addresses later that day.
0x3aB28eCeDEa6cdb6feeD398E93Ae8c7b316B1182
0x7563758243A262E96880F178aeE7817DcF47Ab0f
0xd11616e66b128c0b756b91cC13466deFaae67D07
Only one of them held $ELAN Tokens. (Bitmart 3)
After a thorough audit of BitMart wallet, it became apparent that someone had initiated malicious transactions. Elan immediately contacted @WhiteBit to investigate the suspicious activity and take all necessary steps to protect their exchange from further malicious attempts.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/8cb032d4964342e1a357aa9438b5cea2.png">

@WhiteBit acted swiftly and locked the account for further verification. Then, @JeromeKnowsBest asked TG User @ChadBitMart for more info about the user who initiated the transactions. He replied that BitMart couldn't find any suspicious activity from the transactions.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/7d163b2b70c7479e930b5abd3495650a.png">

TG @ChadBitMart then told Elan's CEO that the funds sent from BitMart to WhiteBIT were from a user who had deposited and bought tokens on their exchange. It quickly became clear that this claim didn't correlate with the blockchain data.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/e31f6ea15ae94f028b8d41aa222808b5.png">

With the funds being locked, it was only a matter of time before the real culprit showed up and reveal himself to request assistance, on February 3rd TG @ChadBitMart (VP of BitMart Biz Dev) contacted Elan's CEO privately to tell him they knew who initiated the transaction.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/c4c496cadf1d4236bf47f372d9a1e47b.jpeg">

The BitMart representative told @JeromeKnowsBest that the transfers were initiated by BitMart themselves and were supposed to be transferred to their cold wallet by their finance team. However, they "mistakenly" sent tokens to @WhiteBit.
<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/d85a7443fafc4210a727dd782dad06c1.png">

Questions:
1. Why send a "test" transaction of 15 $ELAN tokens the day before if it was supposed to be sent to a cold wallet?
2. Why list two sell orders for 18,000 tokens each on the same day if those were meant to be sent to a cold wallet?
3. Would BitMart have contacted @JeromeKnowsBest if their account wasn't locked and needed help to unlock it?
4. If there was foul play, has the exchange been manipulating other tokens listed on its platform?
5. Did BitMart send custodial tokens to @WhiteBit to trade them?
6. Why would BitMart sell tokens on another exchange?
7. How does BitMart handle user funds?
8. Why hasn't BitMart released Liquidity Reserves/Proofs?
From our perspective, and from blockchain data, it seems BitMart may have illegally misappropriated, transferred, and attempted to trade their user's $ELAN tokens worth $300’000. This is pending confirmation that BitMart is the beneficiary of the locked account on @WhiteBit.
Elan Future is now considering its options in view of protecting its community, including de‐listing on BitMart. "We are extremely disappointed in BitMart's unethical behaviour," said Elan's CEO, @JeromeKnowsBest
Access to $ELAN through Exchange listings is important in executing Elan’s roadmap of democratizing stake holding in energy production. However, our objective of a wide and easy access to $ELAN is and should be, subordinated to Elan’s commitment to transparency and fairness.
#Blockchain exposes data opacity and corruption—yet another proof of its worth. Is BitMart to blame here? You be the judge!
Elan will continue to safeguard our community, holders &amp; planet with transparency &amp; openness as essential components for energy decentralization. <a href="https://twitter.com/hashtag/ethics?src=hashtag_click" rel="noopener noreferrer nofollow">#ethics</a>

Has Centralized Exchange BitMart been playing foul? Let's find out.👇

ElanFuture

Other articles published on Feb 13, 2023

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