We first engaged with Alameda’s VC team in September when raising funds to bootstrap the Reef platform. At that time, Alameda passed on an opportunity to invest.
In March, Alameda’s investment arm reached back out around a strategic investment they wanted to make — up to $80M. Alameda’s VC team member Brian Lee wrote: “Reef is a multichain aggregator, and we can explore the angle of integrating with Raydium and Serum on Solana for liquidity.” The $20M worth of REEF was sent to Alameda to engage them as a long-term strategic investor in the Reef ecosystem.
As previously stated, Alameda secured investment in Reef Finance token for $20M at a 20% discount to create various long-term synergies with Serum and Solana. The investment was led by Alameda’s VC team member Brian Lee.
On March 12, after coordination on timing and edits with Brian Lee, VC at Alameda, we moved forward with the announcement approved and edited by Alameda’s team and the $20M investment.
Alameda conveyed interest in investing an additional $60 Million in Reef Finance during this time frame as well.
For the first $20M tranche, we followed the movement of the sold Reef Tokens and immediately saw that the tokens we had just transferred to Alameda were being offloaded on the Binance exchange. Please see Etherscan screenshots. We could not understand why Alameda, our long-term strategic investor would offload their tokens immediately after purchase to Binance.
We did not move forward with the additional $60M tranche due to doubts around Alameda’s long-term interest in being a strategic investor.
After seeing that the additional tranche would not go through, Alameda began threatening to delist the Reef token from FTX and said that they would try to get Reef delisted from other top exchanges as an act of retribution if we did not give them the $60M tranche.
This was also perplexing because the Alameda team had refused to offer a legal contract for the transaction and had asked to operate on based on “trust.”
On Monday, Sam Trabucco, a trader at Alameda, unleashed the following statement:
Why a trader would issue this statement when Reef was a strategic long-term investment for Alameda’s VC was perplexing.
Sam went on to contradict his previous tweet with the following:
This further perplexed the team because it mentioned that FTX had in fact sold a portion of the first tranche while committing to being a long-term strategic investor.
FTX also issued a poll from its official account asking the community if REEF should be delisted because it was a “rug pull.”
Additional threats and legal ramifications were thrown around by their team, at the end, most of which were deleted.
We have been fully transparent with our community and are shocked that such a so-called established player who promised to serve as a long-term strategic investor would attempt to damage our reputation while clearly damaging their own in the process.
This action hurt retail investors and should be a cautionary tale akin to the Wall Street Bets GameStop saga. The actions of one centralized entity such as Alameda and FTX should not and can not influence the future of a community-driven project like Reef.
The fact that Alameda threatened to delist REEF from centralized exchanges in order to cause damage to the project highlights that CeFi players still have a strong influence on the crypto markets. However, with the advent of DeFi, no centralized entity such as Alameda can destroy a crypto project. REEF has strong volume on decentralized exchanges such as Uniswap. The possibility of threats around market manipulation by CeFi players was actually the reason why we wanted to launch a DeFi platform in the first place.
What’s Next for Reef
We will launch our next products on the Reef chain and seek less centralized alternatives to working with the backers of Serum and Solana. We can’t wait for our community of long-term stakeholders and believers to join us on this journey and are excited to release further news on future progress.
With all the noise around, we are glad to have a supportive community advocating for Reef Finance with a positive approach. We will continue to contribute to our vision of driving the DeFi space as one of the strongest smart liquidity aggregators in the Polkadot ecosystem.
We are focused on our vision to revolutionize the DeFi space and are relentlessly working towards the same. We have previously announced strong partnerships and look forward to bringing major updates and strategic developments. We are grateful to our community and stakeholders for instilling trust and confidence within us during these difficult times and hope you can share this story with the broader community to raise awareness.
Thank you for your support.
-Team Reef Finance