Investigation: Findora's huge public offering begins, Stanford star suspected of being "Chinese version of bad blood"

A mysterious Chinese woman received a magical endorsement from a Stanford tycoon. The tycoon suddenly died of cancer, and the top technical team at Stanford left the company en masse. Both sides insisted on their own opinions, attacked and sued each other, and the halo began to collapse. This is the story behind the star project Findora, which officially opened its public offering on December 28, raising up to 21 million US dollars.

Findora is labeled as a star cryptography team from Stanford University, but the actual controllers behind the company are Temujin and a 20-something Chinese woman named Lily Chao. As for Lily Chao, neither the employees of Findora nor the relevant investors know her education and work background. Lily claims to have strong government and Internet company connections in China and Hong Kong. In response, Lily said that her background is very ordinary, so she did not disclose it to the public.

Undoubtedly, Lily has strong public relations skills in the academic world. In 2018, Lily connected with John Powers, the former CEO of Stanford University Endowment Fund (claimed to manage 25 billion US dollars). John endorsed and brought in Charles Lu, Ben Fisch, Benedikt Bunz and other computer PhDs from Stanford University to form a team and establish Findora.

Findora's core appeal is encryption and privacy, and its product is a confidential blockchain that supports confidential transaction processing, verification, and asset issuance. The zkLDB ledger database developed for enterprises is efficient, auditable, confidential, and standardized, emphasizing privacy and scalability. It has worked with Tencent Cloud on a project.

Ben Fisch and Benedikt Bunz are students of Dan Boneh, a famous cryptographer at Stanford. The project's advisors include cryptographer Dan Boneh and former Coinbase CTO Balaji Srinivasan. The industry believes that its technology is unique, especially since Dan is a world-class cryptography scholar. Otherwise, it would not have been possible to obtain investment from PolyChain, a leading venture capital firm in the industry.

Recently, Findora announced that it had received tens of millions of dollars in investment led by Polychain Capital. Other investment institutions include Allchaineed, Krypital Group, Axia8 Ventures, Cabin VC, and Powerscale Capital.

It is worth noting that, as a star project, Findora, except for Polychain, is mostly funded by China's third- and fourth-tier Tokenfunds, and it is rare that no well-known VCs participated in the investment . Powerscale Capital is a fund managed by Lily and John Powers, which has invested in China's cross-border social e-commerce Xipin. On December 24, the public document filed by Ariel Abittan, an early investor of Findora, against Lily Chao and Temujin stated that Lily instructed the company's Chinese members to transfer a large amount of funds to an e-commerce company called Xipin. Findora responded that the information in the indictment was false.

In addition, Wu said that the investment of tens of millions of dollars was exaggerated. Polychain invested about 5 million dollars in 2019. Findora recently disclosed this news to stimulate the public offering that started on the 28th. In response, Findora said: We have many investors, far more than these.

Industry insiders pointed out that Findora's story reminds people of the well-known American technology news "Bad Blood". "Female Steve Jobs", Elizabeth Holmes claimed that only a small amount of blood was needed to conduct a physical examination. Forbes valued her at 9 billion US dollars. Holmes was rarely endorsed by many celebrities, including former US Secretary of State Henry Kissinger, Hillary Clinton, former Secretary of Defense James Mattis, etc. Interestingly, Holmes also dropped out of Stanford University after studying there.

Findora’s controller, Lily Chao, is a mysterious woman who claims to have strong connections with the Chinese government. She is fluent in Chinese and average in English. She gained the trust of a Stanford University boss and helped him to form a cryptocurrency team. However, this Stanford boss, John Powers, died of cancer in July this year.

According to people familiar with the matter, before his death, John Powers said that he had not received any investment promised by Lily. However, Lily said that the fund was jointly financed by a partnership and there was no personal commitment to invest.

Findora has about 20 people, and Lily and COO Liang Jiancun are in charge of finance and legal affairs. The specific technology and project development are managed by the doctoral students of Stanford University mentioned above, who serve as CEO, CTO, etc. The indictment states that Liang Jiancun is Lily's husband, but Findora said that Liang Jiancun is the ex-boyfriend of Lily's assistant, not her husband.

After John's death, Findora began to disintegrate like an avalanche. The indictment stated that the trigger was in October 2020, when management discovered that Lily and others had conducted a round of private placement in China without informing them, and obtained about millions of US dollars. They tracked and found that the cryptocurrency was deposited into a suspected personal Binance account. The funds obtained are suspected to come from the third- and fourth-tier Chinese Tokenfund mentioned above. The indictment accuses Lily of refusing to audit the company's finances, including showing detailed financial information to management. However, Findora responded that the Binance account was used for company operations, such as making payments to partners, and the content of the indictment was untrue.

On November 6, Temujin Labs Inc., controlled by Lily, sued Stanford technology team Ariel Abittan, Benjamin Fisch (former CTO) and Charles Lu (former CEO) in the Santa Clara County Superior Court in California, claiming that the defendants were dissatisfied with Temujin's financial and operational success, and united to obstruct the company's development while preparing to launch a competing business.

Before the lawsuit, the Stanford technical team and its consultants had already begun to resign en masse, while Lily was recruiting community members in China to prepare for a public offering. Charles Lu, Benedikt Bünz, and Benjamin Fisch then tweeted that they no longer had any relationship with Findora and would not endorse its ICO. Findora responded that some former employees fabricated facts, harassed consultants and former employees, and caused the resignation.

On December 24, Ariel Abittan, an early investor of Findora, filed a lawsuit against Lily Chao and Temujin, alleging that Lily and others had misappropriated tens of millions of dollars; often boasted about their close personal relationship with Jack Ma, his wife, and Pony Ma; used company funds to buy pianos, wine, air tickets and hotels for their children, and to shop on Taobao; and instructed Chinese members of the company to transfer a large amount of funds to an e-commerce company called Xipin. Findora said the contents of the indictment were completely untrue.

On December 21, Findora stated that due to different business philosophies, some early members have left the team, and the adjustment of the personnel structure has been completed in accordance with the business strategy at the end of November 2020. Dr. Whitfield Diffie, Turing Award winner and founder of asymmetric encryption, has officially joined the Findora Advanced Research Institute and become a senior consultant to the Findora Foundation. The team is currently fully preparing for the launch of the mainnet, which is planned to be implemented in the first quarter of 2021. However, there are also many voices in the industry that Diffie has a bad reputation and is a very common "money-collecting platform."

Among the partners disclosed by Findora in its public offering, many of them told WuShuoBlockchain that they had no substantive cooperative relationship. WuShuoBlockchain also found a large number of robot accounts when logging into Findora’s WeChat and Telegram communities. Findora said that it had MOU agreements with all its partners, and that all users in the community were real users.

Findora responded that Ariel Abittan, the initiator of the lawsuit, "was burdened with huge credit card debts and had long been a bankrupt in American society." "Findora, which won the fifth Golden Top Annual Blockchain Innovation Application Award, had just come into the sight of domestic peers, but was intercepted by a former company member with a public opinion offensive halfway into the domestic market."

At the same time, the former CTO Fisch was accused of publishing Timothy's proprietary source code, including Findora Ledger and Zei cryptographic library software, online under the pretext of disclosing regulatory information. This behavior has the risk of reducing the commercial value of Findora ledger and Zei cryptographic library. However, there is also information showing that the open source code was approved by Lily.

The current VP of technology at Findora is David Lin, who joined Findora in December this year and received a bachelor's degree from the University of California, Berkeley in 2007. Lily said that the company's current technology is very good, and the Stanford team that left did not make much contribution to the project engineering; the public offering is just in accordance with the established roadmap and is not a "money-making" move; she believes that the technical strength of the project after the mainnet is launched will prove everything.

In short, Findora has lost the halo of Stanford in the farce. The background of the actual controller is a mystery and has no technical background. The top cryptography team hastily left. The public offering amount is huge and there are many doubts. Investors must be cautious. Currently, many lawsuits are being prosecuted. Many parties have stated that they have abundant evidence. The court trial will give the final answer to this foggy project.