Eigen Labs, the company behind the innovative EigenLayer technology, faced scrutiny as employees received substantial payouts from projects using its systems, raising serious conflict-of-interest concerns.
One team reported feeling pressured to distribute tokens to Eigen Labs employees as a way to maintain crucial business relationships, highlighting an ethical dilemma in the token distribution process.
The $5 million in total payouts, which sharply declined to under $1 million during a summer market slump, emphasized the volatility and risks tied to such practices in the crypto space.
In response to these findings, Eigen Labs and its non-profit counterpart, the Eigen Foundation, have banned employee payouts, recognizing potential conflicts of interest and the need for greater transparency.
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