Divergence Ventures Hit With Airdrop Scandal as Analyst Cashes Out $2.5M

Venture capital (VC) firm, Divergence Ventures has been accused of “insider trading” after an analyst made 702 ETH on an airdrop from Ribbon Finance. Whereas, Divergence Ventures happens to be a backer in the DeFi project.

Divergence Ventures Analyst Exposed for Farming Airdrop

The firm is presently at the center of a major scandal, after it was revealed that one of its analysts, a Bridget Waters made about $2.5 million in airdropped tokens from a project the firm had invested in.

On-chain data shows that an Ethereum wallet belonging to Waters got a total of 702 ETH from other wallets that had been included in the recent airdrop by Ribbon Finance. Now, each one of those wallets exchanged the project’s RBN tokens for ETH and then went on to deposit the funds to Waters’ own address. In fact, as revealed by some Twitter users, Waters’ wallet was easily identifiable, because of a recent tweet of hers where she posted her Ethereum Name Service domain back in September.

Divergence Ventures Apologizes

The VC firm has now tendered a public apology after the shady transactions were exposed.

But still, their apology seems to hold no water, even as the crypto community is still full of criticism for the actions. Many are likening Waters’ activity to insider trading. According to popular UpOnly host Cobie, the VC apparently used privileged information to farm and drop $2m airdrop of THEIR OWN PORTFOLIO CO. He further claims that that’s one way to avoid token vesting lockups.

Divergence has now reportedly sent the 702 ETH back to Ribbon Finance, and the Ribbon community manager Julian Koh has openly defended the analyst concerned. In his statement, he explains how the founders of the organization are solely to blame for the incidence and not with Ms. Waters, who’s a college student. Responding to allegations of insider trading being made by the crypto community, Koh claims that Ribbon Finance had made the airdrop clearly known to Divergence Ventures, but didn’t explain the eligibility criteria.