DraftKings' Exclusive Deal Unveiled: A Closer Look at Polygon Labs' Validator Community
Date: 2023-12-02 Author: Dima Zakharov Categories: EVENTS
Polygon's Unequal Treatment:
CoinDesk's investigation reveals that DraftKings, although a validator for Polygon, enjoyed preferential treatment. The review of on-chain records indicates that Polygon provided DraftKings with millions of dollars worth of crypto in 2021. The unique validator deal, previously undisclosed, gives us a rare glimpse into a secretive arrangement.
DraftKings' Special Status:
Despite being a validator, DraftKings did not play by the rules. Instead of adhering to the standard commission rates for staking, DraftKings charged an exorbitant 100% commission, leaving small delegators deprived of MATIC tokens. This unusual deal set DraftKings apart in the Web3 sector.
Uncovering the Rewards:
DraftKings' validator, staking a significant amount of MATIC tokens, amassed huge rewards, contrary to Polygon's claim of equal membership. The exclusive treatment granted by Polygon allowed DraftKings to withdraw 3.2 million MATIC, valued at around $2 million, making it the most rewarded member in the validator community.
FTX Scandal and Validator's Downfall:
The FTX scandal on November 7 fueled distrust in the crypto sector, coinciding with DraftKings' decision to withdraw its MATIC rewards. In September, DraftKings' validator started underperforming and was eventually shut down for failing to meet requirements. Polygon swiftly moved its 60 million delegated MATIC tokens to another validator with zero fees.
