The U.S. Department of Justice has launched an investigation into the sibling duo behind Solana’s Saber Labs.
A Wednesday report from CoinDesk, citing sources familiar with the matter, revealed that authorities at the DOJ are looking into Ian and Dylan Macalinao, the brothers who created the stablecoin exchange Saber Labs.
Saber is a stablecoin exchange built on the Solana blockchain. The protocol has around $21.58 million in Total Value Locked and processed $4.36 million in on-chain volume over the last 24 hours, according to data from DeFi Llama.
Although on-chain activity would suggest the project is still operational, its Discord server appears to be abandoned.
The focus of the DOJ’s investigation is on the crypto projects that orbited Saber, revealed one of the sources, including the Sunny Aggregator and Cashio.
Sunny Aggregator is a DeFi yield farming application, which at one point offered 616% yield for staking sunSBR – a liquid staking version of Saber’s native token SBR. Cashio is a stablecoin protocol that lost $28 million in an “infinite mint glitch” exploit last year. Both projects have seen their native tokens’ value decline to zero and an angry community demanding answers from the projects’ developers on Discord.
These projects were allegedly created by the Macalinao brothers themselves under the guise of a pseudonym. In August, a CoinDesk report found that Ian and Dylan Macalinao used 11 different identities to boost the growth of various protocols built on Solana – something that ultimately led to an inflated TVL of the Solana ecosystem at its peak.
“I devised a scheme to maximize Solana’s TVL: I would build protocols that stack on top of each other, such that a dollar could be counted several times,” wrote Ian, in an unpublished blog seen by CoinDesk.
“If an ecosystem is all built by a few people, it does not look as authentic. I wanted to make it look like a lot of people were building on our protocol, rather than ship 20+ disjoint[ed] programs as one person,” he added.
The Macalinao brothers reportedly abandoned their plans to move Saber to the Aptos blockchain after the CoinDesk exposé, and transferred control over some projects to DeFi protocol Marinade.