Two Top "VC Coins" Engage in a Public Argument, Whose Side Should You Take?

The Ethereum ecosystem has just experienced a turnaround in the past two days, but the Ethereum community is not calm. A dispute has arisen between former members of the zkRollup project Scroll and the co-founders of Movement, who recently completed a testnet and announced an airdrop. Scroll has accused Movement of code plagiarism, while Movement has retaliated, claiming that the Scroll team's behavior has improperly damaged the Layer 2 ecosystem's reputation.

Why Public Feud?

The catalyst for the debate occurred in someone else's comment section. @enshriningplebs posted, "We invented the 'postconfirmations' concept to issue our token before going live on the mainnet." @seunlanlege jokingly replied, "Oh, so only Ethereum Foundation researchers invent some objectively meaningless garbage protocols is cool, right? Such a double standard."

Movement Labs co-founder Rushi Manche then chimed in, saying, "Indeed, only Uniswap and Flashbots are allowed to do that because they align with Ethereum's interests (by the way, I love their architecture). As for the thousands of trendy terms we've created for those useless EVM L2s, that's much more ethical."

Next, former Scroll team member Toghrul directly responded to Rushi's sarcastic remarks, saying, "Stop pretending to be all high and mighty, okay?"

"Tell us about those trendy terms created by EVM L2," he argued. He believed that the new term "postconfirmations" essentially just renamed "preconfirmations," and this rebranding was only done because they were ridiculed for claiming to be a "fast finality Rollup." What's even more absurd is that they themselves couldn't even figure out if it was an Optimistic Rollup or a sidechain, as these two architectures are inherently contradictory.

Toghrul mentioned that he raised these issues in group discussions, but the response he received was, "No one is using them, so they can't be considered innovative," which left him puzzled. He also mentioned that Movement's entire codebase is almost a slight variation from Aptos, with minimal changes. On the other hand, those so-called "useless EVM L2s" have produced many widely used core technologies, such as Polygon inventing Plonky2 and Arbitrum creating a Wasm-based general fraud proof, while Movement doesn't even seem to understand basic EVM support.

Rushi showed no mercy either and directly said, "High and mighty? Are you kidding?" Then he began listing Scroll's offenses one by one.

1. Utilizing the community for years, yet launching a predatory incentive plan that ultimately shifted the burden to ordinary investors.

2. The team continuously sold secondary market shares during the years leading up to the launch.

3. Other team members were forced to buy in at a $1.8 billion valuation while top leadership was selling off at the same time.

4. You even directly airdropped tokens to your own wallet for cashing out.

5. Designed the most predatory tokenomics to ensure harm to every community member.

To directly convey Rushi's anger, here is his original text for readers to feel:

"Today, because of your actions, almost no one is willing to consider themselves an EVM L2 anymore. You delivered the worst product; the entire community and ecosystem resent you, and now obviously, you are at a loose end. I won't comment on technical matters; those should be addressed by researchers. You have been aggressively pursuing me for months, and I have always remained quiet and respectful. Technical debates are one thing; I believe we can improve, but you have crossed the line. If you want to debate with Franck on Spaces, go ahead. Otherwise, improve your own chain and stop making it look like an outright scam."

He also added, "I have respect for certain members of your team, but Scroll and you could be said to be one of the worst participants in this field (even at least 6 of your colleagues—half of whom have already resigned—came specifically to apologize to me and feel ashamed of your actions)."

"In the past two months, a quarter of your team has applied for our positions. There are many people on your side that I like, so I feel a little guilty, but please don't bring up the term 'high and mighty' with me, haha."

Finally, Rushi concluded with, "I am actively searching for 'Scroll scam' and delving deeper to learn more. @toghrulmaharram, don't even think about coming to bother me, haha."

In response to Rushi's accusations, Scroll's co-founder Sandy made several statements in a post today, including:

1. Acknowledging the poorly designed airdrop and its harm to a part of the community, which will be rectified through Session 2;

2. The team wallet did not claim the airdrop. In the future, to avoid confusion, the points related to that wallet will be removed;

3. The team never forced team members to subscribe to the token at the last-round valuation;

4. The team is restructuring to adapt to the next stage of development, and some team members will resign. We believe they will shine in their new positions.

Scroll Controversy Overview

Earlier this year, Starknet sparked outrage due to the term "E-waste." Similarly, Scroll made the same mistake, with its Senior Researcher, Toghrul Maharramov, directly referring to a user as an "E-waste" during an altercation, and even mocking users in posts using malicious language like "fxxk" when seeking airdrops.

On September 15, the Trump family-affiliated crypto project World Liberty Financial announced that Scroll's co-founder, Sandy Peng, had become an advisor to the project. This move was seen by the community as an example of the Scroll team's adeptness at maintaining insider relationships.

In October, Scroll became Binance's first pre-trading project and revealed its tokenomics. However, this news raised community doubts, accusing Scroll of having a low airdrop allocation while Binance Launchpool's allocation was too high, clearly an attempt to please Binance.

From the data perspective, SCR has a total supply of 1 billion tokens, with an initial circulation of only 190 million tokens, accounting for 19% of the total. In the token distribution, airdrops account for only 15%, while ecosystem and growth account for 35%, and the Scroll DAO Treasury accounts for 10%.

Even within the 15% allocated for airdrops, only 2% were in circulation at TGE, with the remainder gradually unlocking over four years. In contrast, Binance Launchpool allocated 5.5%, with 2.5% already in circulation at TGE. The remaining 17% also unlock over four years, resulting in Launchpool having a significantly higher initial circulation percentage than community airdrops.

Furthermore, the Scroll Foundation holds 10%, core contributors hold 23%, and investors hold 17%. The tokens for core contributors and investors start unlocking a year after TGE, but the ecosystem, Launchpool, and Scroll Foundation hold a significant percentage in the initial circulation. This allocation mechanism amplifies the holdings of Binance and large institutions, significantly reducing community interests and deepening the community's doubts about Scroll's tokenomics design.

The community used candlestick charts to show Scroll what uniqueness really means, even Scroll's project logo was ridiculed by the community.

Scroll excels in top-down management on the one hand, but community management seems inadequate. After the controversy between former team members and Rushi broke out, from a community perspective, Movement clearly has the upper hand in public opinion.

Community Perception

Leo Wong, the founder of Movement's WarpGate DEX, stated that Toghrul's attack lacked not only technical basis but also was filled with malice. He accused Scroll of its predatory behavior being evident when criticizing Movement's terms or architecture: internal dumping, exploitative tokenomics, and a community farm based on false promises. These actions not only tarnished Scroll's reputation but also stained the idea of a fair blockchain ecosystem.

"If Scroll has genuine technical criticism, please let your researchers and engineers present it in a respectful manner. Resorting to personal attacks and public defamation will only highlight your lack of confidence in your own platform and practices. The blockchain industry relies on collaboration, transparency, and trust, not this kind of petty retaliatory behavior."

Developer Andrew Capasso mentioned that reshaping Scroll's criticism as a personal attack by Toghrul was actually an attempt to evade responsibility for the team's collective behavior. He believes Toghrul is too caught up in semantics and fails to realize that the real issue is the moral harm intentionally caused by Scroll to the community.

"Whether you like it or not, this undermines your credibility. Accountability and integrity are more important than technical details. You are not just an unknown developer but one of their most powerful PR warriors. Keep digging in, and Scroll's logo will be permanently stamped on you, haha."

Crypto influencer 加密韋馱 stated, "I won't make judgments of right or wrong, but there are some takeaways from these two dialogues that I think everyone needs to know."

1. The 'halal era' where valuation was pumped with just aligning with some ideology is over.

2. Please spend money on people who truly know how to engage with the retail community. People who don't know how to speak should keep quiet.

3. As a project in the crypto world, you are wrong, and retail investors are right. Don't compete with retail investors in terms of research and investment capabilities.

4. It's best to also consider yourself a retail investor, spend some time playing with their favorite things

5. Brainwash VCs, but don't brainwash yourself

Some people also told Rushi that this is completely malicious argumentation, "Toghrul's technical critique has nothing to do with Scroll's poor community management. This is a very good mobilization, allowing those who have been victimized to openly support you, but you must realize that this is not 'good-faith public technical discussion'."

However, Rushi believes that his response post is unrelated to technical issues, only pointing out that Toghrul's attitude towards him and the Movement team is full of malice and insults. "I have always remained silent before because I can handle it myself, but I will never tolerate any insult or harm to my team."