Key Takeaways:
- Customers of Stakehound have lost almost $71 million according to the current prices of ETH in the Stakehound debacle.
- Celsius Network was also involved in the incident.
Scams and rug pull are common in the crypto ecosystem. However, the Stakehound incident that occurred on June 22, 2021, was one of its kind. An Eth2 staking service named Stakehound mislaid keys of over 38,000 Ethereum tokens of clients and kept it a secret till May 2, 2021.
The organization tried regaining the keys without informing their customers. However, after failing to do so, Stakehound filed a lawsuit in an Israeli court against Fireblocks, its custody provider. The customers are still suffering as they hold stETH tokens in large amounts, which are now deemed worthless, as the price of the tokens crashed following the announcement of lost keys, according to CoinGecko.
Recently, Dirty Bubble Media investigated the matter and revealed an association between the Celsius Network and Stakehound, which the customers were unaware of. The report shows that on Feb 2, 2021, the former transferred 35,000 Ether in a single transaction. Certain Celsius wallets hold over 42,306 St ETH, which is believed that Celsius transferred via Stakehound.
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