On August 19, 2024, Binance announced its plan to support the token swap and rebranding of Frontier (FRONT) to Self Chain (SLF). Binance stopped trading and delisted all existing FRONT spot trading pairs on August 27, 2024, and opened new SLF trading pairs (SLF/BTC, SLF/TRY, SLF/USDC, and SLF/USDT) on August 30, 2024. According to the announcement, FRONT was swapped for SLF at a 1:1 ratio.
However, concerns arose regarding the issuance of $SLF, as noted in the announcement, which caught the attention and suspicion of the community.
Token Swap Becomes Token Issuance
The rebranding and token swap were considered typical in the crypto industry, as many well-known projects have undergone similar processes, such as Polkadot and Polygon. For example, in 2020, the Polkadot community passed a resolution to redenominate the DOT token by 1:100, increasing the total supply from 10 million to 1 billion. This year, Polygon initiated a 1:1 token swap of MATIC to POL, maintaining the original supply of 10 billion tokens.
However, in the case of Frontier, the token swap involved an issuance, and holders did not receive corresponding compensation. The total supply increased from 90 million to 360 million tokens, resulting in a 75% dilution in value for users. Most of the 270 million additional tokens were allocated to equity investors (10%), validators/growth sales (28%), the ecosystem (19%), foundational nodes (25%), and the team (8%).
Due to the dilution of value and the unclear purpose of the issued tokens, this action triggered serious dissatisfaction among token holders.
Lack of Transparency in the Community Proposal
The rebranding plan originated from a proposal titled “Rebranding Proposal: Frontier to Self Chain,” which passed on January 19. However, the proposal faced two major criticisms:
1. It did not mention the token issuance.
2. It is suspected that the project team manipulated voting rights to pass the proposal. According to the voting panel, 11 addresses cast a total of 1,548,148 votes, with address 0x55b6918866B147B2a13C1Dc167aE04D806F035B5 casting 1,500,000 votes. On-chain data suggests this address likely belongs to the project team.
Explanation by Self Chain’s Founder
Addressing the concerns over the “increased token supply,” Self Chain’s founder and CEO Ravindra Kumar responded on the X platform, explaining that Self Chain was not a new team but a strategic rebranding by the original team, expanding from a wallet project to a Layer 1 blockchain based on the Cosmos-SDK. Kumar explained the distribution of the 360 million total supply: 36 million permanently locked for foundational nodes, 90 million migrated from FRONT to SLF, 10 million allocated to new investors as validators (with an 18-month lock-up period), 36 million allocated to equity investors (36-month lock-up period), 30 million allocated to the core team (6-year lock-up period), and 68 million allocated to the ecosystem (released 1.5 million monthly). Kumar stated that the increased supply was intended to enhance network security, protect against a 51% attack, and attract more investors and validators.
However, the market did not respond well to the official explanation. After the token swap, the price of $SLF plummeted from an opening price of $0.88 to around $0.47.