Axie Infinity CEO Denies Claims Of Insider Trading; Game Token’s Value Down To Zero

Trung Nguyen, co-founder and CEO of Axie Infinity, has refuted allegations that he engaged in insider trading just before the game’s parent company, Sky Mavis, disclosed a $600 million hack.

Between the March attack and the revelation, Bloomberg reports that a wallet linked to Nguyen transferred almost 50,000 AXS tokens, worth approximately $3 million, from the Ronin blockchain to Binance.

After Bloomberg shared its on-chain research with the Vietnam-based game maker Sky Mavis, a spokesman for the company, Kalie Moore, acknowledged that Nguyen was responsible for this transaction.

Axie Rep Spills The Beans

Moore said:

“At the time, we (Sky Mavis) realized that the more AXS we held on Binance, the better our position and options would be. This would allow us the freedom to pursue various loan/capital acquisition options.”

Although the transfer could be seen by anyone, there was no information in the wallet that might identify who was in charge of it. Sky Mavis, however, acknowledged Nguyen was in charge of the wallet after being shown an examination of publicly available information that appeared to link the wallet to him.

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Moore stated that Sky’s founding team chose to transfer it from this wallet “to prevent short-sellers, who track official Axie wallets, would not be able to front-run the news.”

Sky Mavis halted all platform transactions and locked all user assets after the trasfer. The article said that the proprietors of Axie Infinity wished to safeguard their tokens and sell them before securing the remaining assets.

Bloomberg published a thorough story citing Moore as a witness to the act. In a subsequent tweet, Nguyen dismissed the claim that he engaged in insider trading as “baseless and incorrect.”

Axie CEO Says It’s All Lies

This story includes speculation of insider trading. These accusations are baseless and false. In fact, the Founding Team even deposited $7.5M from a known Axie multi-sig wallet TO Ronin Network prior to the bridge closing to avoid triggering any short-sellers watching.

— Trung Nguyen (@trungfinity) July 28, 2022

Nguyen referred to Axie Infinity as his “life’s work” and stated that his team was “in close contact with Binance to discuss the shutdown of the bridge and how to ensure that user monies were refunded as quickly as feasible.”

Moore disclosed to Bloomberg that Nguyen made the transfer to assist the company’s finances during the crisis in a way that would not be visible to the broader crypto market and would be beneficial for Axie Infinity’s economy as a whole.

Axie Infinity SLP Token Now Worthless

With around $4 billion in NFT trade volume and millions of daily players at its peak in 2021, Axie Infinity is the most successful cryptocurrency game to date.

Unfortunately, the game’s play-to-earn economy began crumbling late last year prior to the March hack, prompting a number of modifications in an effort to breathe new life into the monster-battling game.

The game’s SLP prize token has lost 99 percent of its value, from its peak, to its current worth of $0.004.

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AXS total market cap at $1.5 billion on the daily chart | Source: TradingView.com

Featured image from Tum Sozluk News Science Education, chart from TradingView.com