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Seele ICO: Hack Or Inside Job?

Sead Fadilpašić
Last updated: | 1 min read

More Initial coin offering (ICO) investors fell victim to either a hack or a scam: Seele, calling itself Blockchain 4.0, lost their investors around USD 2 million in Ethereum coins, either through a scam or through negligence.

The two attackers posed as verified admins on the company’s Telegram channel, using the messaging service to solicit ETH payments from members of the public who had joined the group, ostensibly for a private sale. The actual ICO has not yet begun.

Seele responded with a pinned message on Twitter: “We are deeply sorry for the problem caused by the “@seelesupport” and “@nicsmith” scammer and are taking full responsibility for it. We care about our community and are taking all necessary precautions to prevent something like this from happening again […] We are hereby acknowledging the situation and confirm that we will find solution to make the situation right for all community members who have lost funds due to this problem.”

While Seele claims their Telegram channel has been compromised, the community has pointed out that nobody except for the admins can appoint another admin. This way, either some (or all) of the real admins are working with the scammers, or they have neglected to check who they are appointing as admins. IPO (Initial public offering)-standard rigors may not apply to ICOs, but any startup seeking funding from investors needs to show a commitment to being organized, transparent, and in control.

But what is Seele? Their blurb seems like a prime example of technobabble: “Seele is powered by an up-scalable Neural Consensus protocol for high throughput concurrency among large scale heterogeneous nodes and is able to form a unique heterogeneous forest multi-chain ecosystem.” Its whitepaper says all blockchains will take part in one larger blockchain, the Meta chain – seemingly akin to Multivac, a fictional supercomputer appearing in several science fiction stories by American writer Isaac Asimov.

The team has released a statement on their official website, promising “detailed compensation plans” and restricting admins’ privileges with a “double authentication method, i.e.: face recognition and scheduled login.”