OpenSea's Former Executive Faces $60M Pump And Dump Accusations
OpenSea controversy: Former head of ventures allegedly involved in questionable activities, including pump and dump schemes. Company distances itself.
OpenSea, the platform where digital collectibles are bought and sold, has been in the middle of a controversy. An account referred to as X, disclosed that Kevin Pawlak, OpenSea's former head of ventures, was allegedly involved in questionable business activities. Under the pseudonym 0xSisyphus, Pawlak is believed to have engaged in several suspicious business dealings, including pump and dump schemes.
One of the most significant allegations against Pawlak is his purported involvement as a key influencer in the $60 million rug pull of AnubisDAO. NFT Ethics, a watchdog in the space, has claimed that Pawlak attempted to sway decisions at OpenSea without revealing his true identity. By not disclosing that he was an actual employee who could profit from those decisions, he may have breached ethical standards.
1/ Dear @OpenSea, what do you think of the fact that your Head of Ventures, Kevin Pawlak, has been involved in various very dubious business dealings (e.g. Anubis) and pump & dump schemes under his pseudonymous identity @0xSisyphus (& 0xMagellan)? pic.twitter.com/GzIVLJirLE — NFT Ethics (@NFTethics) October 6, 2023
NFT Ethics, in its investigation, compared the timestamps on Pawlak's crypto domain (pawlak.eth) with that of 0xSisyphus (sisyphus.eth). The findings indicated that the addresses conducted on-chain activities almost simultaneously, suggesting a potential link between the two identities.
OpenSea has been quick to distance itself from the controversy. A spokesperson for the company stated that Pawlak departed from OpenSea in June 2023. The company emphasized its lack of awareness regarding Pawlak's alleged involvement in any scam schemes. They further clarified that his role at OpenSea was of "limited scope".
"Kevin is a former employee who left the company in June 2023. He had a limited scope while at OpenSea — where he worked in a non-management position. We have no awareness of his involvement with the projects in question."
In October 2021, AnubisDAO successfully raised 13,556 Ether (ETH), valued at $60 million at that time, from investors. Unfortunately, within a mere 20 hours, the funds were quickly transferred to multiple wallet addresses, leading to an immediate loss for these investors as the project's value plummeted.
This isn't the first time OpenSea has faced scrutiny over its executives' actions. In August 2023, Nathaniel Chastain, a former product manager at OpenSea, was sentenced to three months in jail for insider trading on the platform. He was also fined $50,000 and ordered to forfeit any illicit cryptocurrency gains from his trading activities on OpenSea. Chastain later chose to retract his bail application, opting to serve his sentence while his appeal is under review.