A group of investors wrote to Astra Protocol to express their serious concerns regarding the company and its ASTRA Token. They demanded a meeting within 48 hours, or else the concerns would become public. A copy of the letter, obtained by CoinDesk, outlines the letter.

Astra Protocol, based in Switzerland, offers Know-Your Customer (KYC), and Anti-Money-Laundering Services. The company’s advisory board is stacked with former Samsung corporate president and chief strategist Young Sohn, as well as former White House acting Chief of Staff Mick Mulvaney and former Secretary of Homeland Security Kirstjen Nielson, and former European Commission for Trade Phil Hogan.

A person with knowledge of the situation informed CoinDesk the letter was sent on June 11 to Astra, meaning that the warning period ended on June 13

Investors cited suspicious movements of ASTRA tokens. Our most pressing concern is the token movement. The Astra token address has repeatedly transferred substantial sums of money to CEXs. This occurs suspiciously just before new announcements are made and is always followed by a dramatic drop in the token price. The explanations provided so far for these events have been vague and unsatisfactory,” wrote consortium in a letter to Astra Protocol Co-Founders Damien O’Brien and Arthur Ali.

Shima Capital was one of the names on the letter, along with Huobi, Moonrock Capital, Republic, and others. Shima Capital confirmed that the venture capital firm signed the letter. Shima Capital refused to comment on whether any discussions took place after the warning period expired with the investors.

Astra Protocol did not respond to CoinDesk’s request for comment by the time of publication.

List of Concerns

According to the letter, the investors’ main concern was the lack of communication between the protocol and its investors.

The consortium wrote that it had never seen an enterprise show such disregard for investor communications, including ignoring inquiries or cancelling scheduled meetings haphazardly.

Investors claimed that the group tried to communicate with Astra to resolve issues repeatedly, but without success. This led them to write the letter. The letter stated that despite our repeated attempts and lack of response to engage with you to resolve these concerns, the group felt obligated to send a final joint appeal urgently demanding actions.

Investors expressed concerns about strategic decisions, such as the sudden extension of the cliff for six months (the period in which investors are able to access their invested equity), which they claim was done to exhaust the supply of liquid tokens. The group points out that ASTRA’s token price is well below what investors paid and that there are no signs of recovery. ASTRA had risen by nearly 60% in the last 24 hours to $0.02835 at the time this article was published.

Investors also question a number of announcements and promise that seem “misleading” and “deceptive”, as they “either have failed to materialize, or have been made solely by Astra without third-party verification.” Examples are Samsung joining Astra as an investor and partner, KPMG utilizing Astra’s compliance technology, the listing of ASTRA at Binance, along with the integration Astra’s technology throughout Binance’s Middle East and North Africa region.

The letter concludes with a request to make a call in 48 hours to discuss these concerns. “If you do not comply with this request, we will have no choice but to publish a joint article expressing our concerns regarding the project and team.” CoinDesk does not know if any discussions took place.

Jesse Hamilton, Nikhilesh De, and Aoyon Asraf edited the book.