One of the main validators of the Secret Network blockchain layer 1 privacy smart contract has announced that it will no longer provide nodes and support for the network.
On January 29, leading validator Smart Stake announced that it plans to shut down the Secret Network validator nodes on February 21.
As reasons to terminate their services, Smart Stake cited “complex/stressful validator operations, cost/effort of validator operations and recent events”.
Smart Stake is a staking and validator service provider that supports several networks, including Crypto.com, Polygon, Cosmos and, until recently, the Secret Network.
PSA for Smart Stake @SecretNetwork Delegates:
Smart Stake will close its secret validator on February 21st. Please re-delegate to another validator.
Reasons: 1) Complex/stressful validator operations on $SCRT 2) Cost/effort of validator operations 3) Recent events
PSA for @SecretNetwork delegates of Smart Stake:
Smart Stake will be shutting down its Secret validator on 21st Feb. Please redelegate to another validator.
Reasons: 1) Complex/stressful validator operations on $SCRT 2) Cost/effort of validator ops 3) recent events
— Smart Stake (@SmartStake) January 29, 2023
The decision follows revelations by Guy Zyskind, founder of Secret Labs, about the financial transparency of the Secret Foundation.
On Jan. 28, Zyskind went public with allegations that the foundation and its founder and CEO, Tor Bair, “they sold a significant amount of dollars in SCRT”the native token of the Secret Network, at the end of 2021.
“Tor has raked in a significant portion of these proceeds”he has declared.
Zyskind also mentioned a $4 million inflow for the foundation in its Q4 2021 report, but didn’t mention the withdrawal.
“This action has not been disclosed in any financial reports provided to the community by the Foundation, which has been presented by Tor as a non-profit organization on several occasions.”
Can’t wait to get back to writing math proofs and crappy code after all the @SecretNetwork drama.
Looking forward to resuming writing math proofs and bad code after all the @SecretNetwork drama
— Guy Zyskind (@GuyZys) January 29, 2023
On the same day, Bair provided his version of events on the Secret governance forum, reporting that the withdrawals were part of his share of acquired tokens.
“Instead of paying my accrued tokens in December 2021, I converted my portion of accrued tokens into USD at the OTC price and Secret Foundation distributed these funds as dividends.”
He added that “This information is verifiable in our 2021 tax filings previously reviewed by Labs, to whom I have already disclosed this information.”
The internal leadership conflict has definitely shaken the provider and the ecosystem community.
SCRT prices have remained immune, consolidating around the $0.80 level for the past week. However, the token is down 92% from its all-time high of $10.38 in October 2021 and Bair’s $7 sale price.
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