Edel Finance Token Launch Faces Scrutiny Over Unusual Token Accumulation

Edel Finance Token Launch Under Scrutiny

Concerns are escalating over unusual activity surrounding the token launch of Edel Finance, a decentralized lending protocol specializing in tokenized stocks and real-world assets (RWAs).

Blockchain analytics firm Bubblemaps reported on Tuesday via X that a cluster of approximately 160 wallets amassed roughly 30% of the EDEL token supply, valued at approximately $11 million, during the launch earlier this month. The platform alleges these wallets were linked and received coordinated funding just before trading commenced.

"Edel Finance sniped 30% of $EDEL, then attempted to conceal it behind a complex network of wallets and liquidity positions," Bubblemaps stated. "Just hours before the $EDEL launch, approximately 60 wallets received funding from Binance. Collectively, they secured 30% of the total supply, now worth $11 million.""

In cryptocurrency jargon, "sniping" involves using automated trading bots to rapidly acquire newly released tokens. Snipers aim to capitalize on early price advantages before wider market participation.

Bubblemaps asserts that the wallets were all funded with Ether (ETH) around the same time, channeled through an intermediary "layer of fresh wallets" before purchasing EDEL tokens via the final wallet layer.

Each wallet retained 50% of the sniped EDEL, while the remaining 50% was distributed among approximately 100 secondary wallets, reportedly funded through the MEXC exchange.

"The list of all 100 secondary wallets is directly embedded within the token contract's creation code," Bubblemaps explained, implying a "clear link between the team and the snipers."

Cointelegraph has not independently verified the wallet cluster’s acquisition of 30% of the token supply.

EDEL, launched on November 12th, currently has a market capitalization of approximately $14.9 million but has decreased by 62% over the last week, according to CoinMarketCap data.

Edel Finance is positioned as a decentralized lending protocol striving to integrate traditional stocks into on-chain lending. The team boasts prior experience at firms like State Street, JPMorgan, and Airbnb, as indicated on their X profile.

Edel Co-founder Denies Sniping Allegations

In response to the Bubblemaps findings, James Sherborne, co-founder of Edel Finance, stated that the team intended to acquire 60% of the token supply, which was subsequently locked into token vesting contracts.

"Interesting chart - but inaccurate...we actually acquired ~60% of the supply and placed the tokens into a vesting contract, as per our documentation," Sherborne posted on X in response to Bubblemaps.

Based on tokenomics documentation provided by Sherborne, only 12.7% of the token supply was allocated to the team, subject to a 36-month vesting schedule with 6-month cliff unlocks.

Bubblemaps dismissed this explanation as a "Hayden Davis defense," referencing the controversial co-creator of the Official Melania Meme (MELANIA) and other memecoins. Davis previously launched the Wolf of Wall Street-themed memecoin with an insider supply exceeding 80%, leading to a 99% price collapse within two days.

Bubblemaps retorted, "I sniped my own token without informing anyone, but trust me, it's fine. If you were genuine, you would have allocated the supply upfront based on your tokenomics."

Furthermore, Bubblemaps asserted that the 50% EDEL token supply designated for the vesting schedule originated from the token deployer and is "unrelated to the snipe."

Cointelegraph has reached out to Edel Finance for comment.