Golem released a much-awaited report explaining why it transferred 135,000 ETH to CEXs.
Decentralized computing protocol Golem has been under fire for transferring $337 million worth of ETH to centralized exchanges (CEXs) and not offering an explanation. It transferred 135,000 to Coinbase, Binance, and Bitfinex. Users felt the Golem team indulged in a massive sell-off without the community’s consensus.
The protocol released a report recently explaining the reason for the asset movements, which started with a transfer of 29,000 ETH in July. Golem stated it made the CEX deposits to ensure smooth and secure staking.
“Given our decision to utilize a significant amount of ETH for testing within the Ethereum Mainnet, we prioritized high operational security,” Golem’s report read. “Our objective was to create a controlled environment where we could monitor the impact of various factors on the staking-related processes.”
Golem Could Have Handled the Situation Better
While this explanation comes months after the transfers began, the Golem community remains torn. Many members felt the obvious frustrations from the get-go, assuming the protocol’s team participated in dumping activity for self-motivated profits. Some members understood the transfers could be because of staking reasons. Still, they questioned Golem’s reliance on CEXs for the solo staking process.
Golem’s team not answering users’ questions or trying to ease their worries did not help either. It did not provide details about why the transfers occurred, deflecting questions and not getting to the point. That further fueled speculations among the community.
Many users communicated the same even after Golem released the report, stating how effective communication from the start could have helped Golem not affect its reputation. Furthermore, it promised to release this report in August, which it did not, further hampering its credibility.
