This is what happened on Feb24 23:59 UTC for Defi100, an one-person account as a liquidity provider.
I bought the D100 because I liked the idea of a defi index and elastic supply. Also defi100 seemed more innovative than other semi-scammy rugs on BSC. I put in a large amount in it and was a liquidity provider earning a fair amount of fees from the high trading volume after IDO.
What happened at Feb24 23:59 UTC:
There was supposed to be a first rebase at that time, which means if the token price is $2 and the defi market cap is $1, the token amount I hold should increase to 2 and the price should drop to $1, in the end, the dollar amount of what I hold shouldn’t change.
Prior to the midnight UTC time, the price of the token had been hovering around $3 during the day and it pumped to $4 right before the rebase.
Then the 23:59 UTC hit, nothing happened, there was supposed to be a rebase, but absolutely nothing happened.
I was still pretty confident, so I thought there must be some delay related to block production or whatnot. I had to get off the computer for a while for some chores, and an hour later I came back to the computer, and found out the price of the D100 dumped from $4 to $2, and yet still, no rebase had happened. At this point, the team disallowed chatting in the telegram group. My heart sunk.
The very act of banning people from talking instead of communicating about what’s going on is a very huge red flag. I was actually glad that the price wasn’t $0 and I haven’t lost all of my money. I decided to remove my liquidity, and sell D100 for BNB at the average price of $1.9 — $2.
Right before I removed the liquidity, at exactly Feb 25th 1:00 UTC, I recorded the k product of the BNB and D100 tokens in my pool. In AMM, the product K = x*y of two tokens x and y should be constant, and it should slowly increase with transaction fees. But I notice that the k at the time was DECREASED from earlier, which should have be impossible, unless one of two things happened: (1) there was a negative rebase such that my D100 token amount shrank (2) there was a partial rug pull that takes out some of the D100 token.
Regardless of what the reason is, I completely lost trust over the defi100 team. They completely shut down any form of communication and was in hiding, and it seemed like this is the new rug pull on BSC. Or they were in shock as I was, and was dumbfound and didn’t know what to fuck to do. Either way, I decided to cut my losses and sold all D100 at about $10k loss from my original investment.
About 20 minutes later, at Feb25 1:20 UTC, the D100 telegram channel came back up and the team announced that they did a “manual rebase” at 162% rebase rate. At that point, D100 price was rebased to $0.8 and that means the price prior to rebase was 162% / 0.8 = $2. A 50% drop from the $4 at 23:59 UTC. Given the situation, I sold at $2, which means I didn’t lose out by selling.
I tried to ask what happened on the telegram channel, no one from the team answered me. No explanation. Everything was going on as usual again, at this point, there were multiple accounts that started pumping the token, sending out chats and memes to drown out the people that were questioning what happened, and I got a few insults laughing at me for selling. The price of D100 came up from $0.8 to $1.2 and stayed around there at time of this writing.
I am not going to touch this token again with a 8-feet pole, pump or not. The way the team rushed a non-functioning product (note the website dashboard is still not fixed and is still showing a price and market cap of 0) to IDO, and handled this crisis this badly, is not going to get a cent from me. Granted, with enough pumping, the market cap could go 5x, 10x, whatever, anything is possible in crypto. But again there are other actually good products with good team and community, that will also go 5x, 10x, 100x, and I will be able to sleep at night and feel proud of myself by holding them and earning LP fees from them instead.
I admit I considered re-joining the bandwagon to buy back D100 due to the intense pump action, but at this point, something fundamental was broken. What’s the word, trust? The counter-party risk for D100 at this point is simply too high. If this happened once, and the problem is not fixed, and the team chose to shut people up instead of being transparent, this means the same thing will happen again, and again, and again. And guess who is the bag holder.
As a final note, I am semi-sure that there is a bug in the smart contract, probably the oracle part that records the D100 price, which resulted in a faulty rebase, and it persists until now. The team probably didn’t test it well enough before they rushed it for an IDO, probably hoping to catch the bull trend in BSC to make some quick money, like so many other shit coins on BSC. Given that smart contracts are immutable, and they live forever on the blockchain, the only fix for them might be to do manual rebase every night while pumping the token to drown out dissenting voices. In other words, they are winging it. Good luck with that cluster fuck.
If you join their telegram, nothing about what happened is talked about, or addressed, and it’s an enormous pump party. I am just leaving a voice of reason and my rekt story for anyone who considers buying in D100.
Btw they have banned me from posting this article in their telegram chat, and deleted my post in their reddit, I tried to talk to the dev directly, and my telegram is blocked. Yikes.
