RBC.ru - The Mode cryptocurrency project was suspected of manipulation during the airdrop of tokens.
The developers of the Mode crypto project released a token and distributed it to early users, but the community remained dissatisfied. The project was accused of deliberately delaying the airdrop, and its team refused to understand the problems
The author of the column is a former employee of RBC-Crypto and the author of the telegram channel “In Pursuit of Airdrops” Dmitry Fomin-Lopukhin.
The Mode startup, which launched a second-level network, conducted an airdrop. On May 7, the project developers released a token and distributed it among early users, and also announced the start of a new reward season. However, the community was rather reserved in its assessment of the first distribution.
The network was launched in February of this year. The developers immediately announced the future airdrop, which helped them attract a significant amount of capital. Over these few months, users contributed more than $500 million to the project, according to data from the Defillama service.
The airdrop was carried out based on a points system. They were issued to users for storing funds within the Mode network on different platforms. The greater the user's capital, the more points he received. In addition, they could be earned by inviting new members.
The profitability of the Mode airdrop was approximately 50% per annum or 4% per month. To put it another way, if you had invested $1,000 in the project at the beginning of February, you could now have a return of about $120. Let me clarify that these are very rough calculations, since many factors influenced the increase in points, and revenue does not take into account commission costs.
The distribution of Mode tokens turned out to be small when compared to other projects. For example, at the beginning of 2023, the airdrop was carried out by the developers of Arbitrum, a second-level network. Back then, users received an average of about $1,000 in cryptocurrency, regardless of the invested capital. However, it wasn’t just the size of the airdrop that disappointed the community.
What's wrong with airdrop
The first strange things arose at the distribution stage. As a rule, projects open a web page where you can pick up tokens at least 30-60 minutes before listing on exchanges. This is necessary so that users have time to receive coins and send them to the trading platform before the opening of trading.
In their Discord channel, the Mode developers wrote that the request (“stamping”) of tokens will become available shortly before the token is listed on exchanges. However, the opposite happened. At 14:00 Moscow time, the coin began trading on the Bybit and MEXC platforms. However, the web page for receiving the drop was still inactive. The opportunity to pick up tokens appeared only 10-15 minutes after listing.
The price of the Mode token began to rise sharply at the opening of trading. Within the first minutes it rose from $0.05 to $0.20 on MEXC and to $0.16 on Bybit. It is unknown who sold the coins during the growth. But as soon as users had the opportunity to pick up tokens, the coin rate began to decline sharply and dropped to $0.05. The drop occurred even before the first recipients of the airdrop could bring the tokens to the exchanges, since crediting the asset takes about 20 minutes.
Mode users in the project’s Discord channel began accusing its developers of deliberately delaying the airdrop mark in order to have time to throw off tokens at an inflated price. The official representatives of the project did not comment on the claims of their community.
We dig deeper
Another Mode problem concerned the referral system, and we encountered it personally. In Mode, you can receive a percentage of the points that are awarded to the users you invite. And you cannot bypass this system: when registering in the project, you are asked for a referral code, only after entering which will the points begin to “drip”.
In the first month of Mode's work, there was no way to see who invited you to the project. However, in April, the developers added this feature: from that moment on, the inviter’s wallet began to be indicated in the user’s personal account. And here the most interesting thing was revealed.
First, I discovered a discrepancy in my personal profile. I deposited assets into Mode on several wallets. And he registered one of them using a referral code for the other. But for some unknown reason, the profile of the last account indicates that he was invited by another address that has nothing to do with me.
From the point of view of participation in the project, this is a very strange address. There are no assets on it in the Mode network. Otherwise, there were only three days during the entire campaign: at the end of March, 1 ETH was received in the wallet and a few days later it was withdrawn to another address. Since then, the wallet has been empty and, therefore, has not gained points.
However, this account has accumulated 12 thousand points, according to the list of participants published by the Mode developers. Almost all of them were received from referrals, since for three days of storing “ether” in the Mode network one could earn no more than 250 points.
Initially, I assumed that there was a technical error. To figure it out, at the beginning of April I turned to the official Mode Discord channel for help. One of the project administrators under the nickname Shadow answered me there. He asked to describe the situation to him in personal correspondence, and after reading the details he disappeared. More than a month has passed since then, Shadow has not responded to requests and continues to ignore them.
A similar situation occurred with other Mode administrators working under the nicknames Janitor and Arrow. They also asked to describe the problem to them, and after reading the details they stopped responding to messages. Let me clarify that these are Mode administrators, and not scammers posing as them.
Not alone in the field
After the administration completely ignored the problem, I began to suspect that something was fishy here. Then I asked my friends and subscribers who registered using my referral link to check who they listed as the inviter.
Here, too, inconsistencies emerged. The member of my team who is pretty sure he used my referral code also happens to be a third-party invitee. And this one looks even more suspicious than the first. He also has an extremely low balance on the Mode network: only $150 in ETH. And there is not a single transaction on this network. That is, the wallet balance has never exceeded the current value.
At the same time, this wallet entered the top 500 recipients of the Mode airdrop. He was given about $8,000 worth of tokens, half of which will be unlocked within 3 months. This address collected 309 thousand points and all of them were obtained through the referral system.
A member of my team contacted the Mode admins through their Discord channel. However, in this case they also ignored the requests and stopped communicating after the request.
Then another user who invested in Mode contacted me. He said that he registered one of his wallets using a referral code for another. But as it turned out later, this account was listed as an invited unknown address. He also has a low balance on the Mode network, only $30 in Ether and it has never been higher.
Despite this, the third unknown wallet scored 370 thousand points, all of which came from referrals. This user entered the top 400 participants in the Mode airdrop, receiving $10 thousand in tokens from the project, half of which will be unlocked within 3 months.
All three addresses we found do not belong to public referral wallets. Usually, if a wallet belongs to a popular crypto blogger or project, then it can be easily found through Google. For example, if you type into a search engine the address of another major Mode participant (0x9df1414982bcd335be11365e680ff7e00c62964a), you will see that it belongs to the airdorps.io project. Searching for the wallets we found does not give a relevant result.
Bottom line
Regarding the listing of the token, one can only accuse the Mode developers of having a mediocre attitude towards their community. Before users had the opportunity to pick up the airdrop, only the developers and private investors of the project had tokens. Perhaps they preferred to sell assets before the price was driven down by sales of ordinary users. Hence the delay in launching the web page for receiving the distribution.
But the situation with the possible substitution of referrals looks worse. It is hardly possible to prove that the Mode developers deliberately substituted the addresses of their private wallets in order to collect points through the referral system.
However, it is a fact that there are users who, instead of those who redeemed them, had other, suspicious wallets with a zero balance and a huge number of points. It is also a fact that the Mode administration knows about the problem, but instead of investigating it, it chose to remain silent and for more than a month has not given a single comment on this matter.
