Author: Climber, Golden Finance
Currently, it is normal for projects to change their names. Recently, MakerDAO changed its name to Sky Protocol, MATIC changed its name to POL, and Fantom changed its name to Sonic Labs. However, usually, investors are given equivalent tokens when swapping tokens. However, recently, some project owners have played a "sexy operation" by increasing the issuance of tokens by 4 times but still only swapping them at the original ratio.
On August 30, Binance announced the completion of the Frontier (FRONT) token swap and brand upgrade to Self Chain (SLF). SLF will be used as the new FRONT token code, and all FRONT tokens will be swapped for SLF tokens at a ratio of 1 FRONT = 1 SLF.
However, such an announcement has caused dissatisfaction and condemnation from community members. The main reason is that FRONT increased the number of tokens by 4 times, from 90 million to 360 million, while changing its name. However, the replacement compensation is still based on the original ratio, which undoubtedly dilutes the value of investors' tokens. Binance was also accused by the community for not disclosing the announcement in time. So has the project owner Frontier really been hiding the information about the increase in issuance? How do members of the community view this matter?
FRONT changes its name to SLF, Binance accused of lacking additional issuance information
After Binance officially changed the name of FRONT and launched SLF, KOL @bitcoin136 published a long article stating that because Binance failed to clearly mention that the token would be issued in the announcement of FRONT’s name change on August 19, it bought in advance and suffered financial losses.
At the same time, he also posted the chat records between him and Binance’s customer service, in which the customer service repeatedly stated that users need to research and understand the background information of the project party themselves. In addition, Binance also stated in a subsequent reply that they did not include the token issuance in the announcement and would optimize the subsequent process later.
@bitcoin136 also mentioned that another exchange, gate.io, had stated the FRONT issuance information in an earlier announcement. Therefore, he hoped that Binance could give a corresponding response to this incident.
@bitcoin136's remarks also attracted support and approval from many community members, who accused the project party of changing its name and issuing more tokens, as well as Binance's failure to fully disclose information.
In fact, Binance did not mention the token issuance in the announcements on August 19 and August 30 regarding the swap of Frontier (FRONT) tokens and the brand upgrade to Self Chain (SLF). However, in the announcement on September 1, Binance has updated the changes in the total supply of SLF tokens.
The announcement update information is: Please note that after this brand upgrade, the total supply of project tokens will increase from 90,000,000 to 360,000,000. Users can refer to the SLF project token economics and project announcement for more information.
However, as of the time of writing, Binance has still not provided further explanation or response regarding the missing information on token issuance.
The additional issuance has aroused heated discussion in the community, and the Self Chain new currency proposal was hidden at the beginning of the year
Many community members expressed their questions and opinions about what happened to @bitcoin136 and similar FRONT holders.
On-chain analyst @defioasis believes that the SLF token issuance increased by 4 times, but users exchanged it at a 1:1 ratio, which is equivalent to a 75% dilution of users. The previous project proposal vote also showed that the project officials were behind the token name change.
KOL @nft_hu said that Binance and the project team went too far. After the token issuance, they should not be replaced at a 1:1 ratio. The lack of additional explanation in the announcement would make investors think that the total amount of tokens is unchanged by default, which is a loophole to deceive users.
KOL @hongshen6666btc also said that the project party’s behavior of exchanging and issuing additional FRONT coins was too unscrupulous.
KOL @Bingege888 explicitly questioned why Binance approved the token swap for a disguised additional issuance project, and asked about Binance's process for renaming old projects and listing new coins.
Some radical community members even believe that this additional issuance was an act of cutting leeks initiated by Binance and the project party, but in fact there is currently no conclusive evidence to prove that Binance was indeed involved.
As for the name change and additional issuance, Self Chain officials gave an explanation and description.
On August 31, Self Chain wrote in a blog post that as to why the total supply of SLF increased relative to FRONT, before the team launched the brand conversion and token swap, Self Chain DAO conducted a voting proposal from January 12 to January 19, 2024. The proposal included details such as the increase in the total supply of SLF, distribution, unlocking schedule and purpose, and the voting result reached a 100% approval rate.
The total supply of SLF has been set at 360 million, which is higher than the total supply before FRONT. 28.8% of the total supply will be released on the TGE, about 103.6 million SLF. 90 million comes from the migration allocation and 13.6 million comes from the ecosystem allocation. Therefore, 3.78% of the new tokens will be issued on the TGE.
At the same time, Self Chain hopes that FRONT holders can benefit from the replacement and name change. The specific reasons for this adjustment are:
Network security: In order to protect the self-chain network from 51% attacks, increasing the total supply is necessary to ensure a higher host ratio.
Attracting Investors: The new token economics is designed to attract investors and stakeholders, which is critical to running a secure layer 1 blockchain.
A new era: Moving from simple utility tokens to strategy-focused layer-1 blockchains requires more comprehensive token economic structures to support enhanced functionality and infrastructure.
summary
Recently, more and more project parties have changed their brands, including some well-known projects. As mentioned above, token swaps should guarantee the rights and interests of investors. Although Binance failed to disclose the additional issuance information in a timely manner, Self Chain, as the responsible party, should swap according to the value ratio of the additional tokens anyway.
