DeFi yield agreement PiggyBank released a withdrawal report on June 10, confirming that a $100,000 basis trade involving the LAB token failed due to market manipulation, resulting in approximately a 15% drawdown in the USDC vault, about 12% in SPYx, and about 9% in JitoSOL. PiggyBank pledged to compensate affected users, but as of the time of the report, it had not disclosed the total amount of losses or a compensation timetable.
PiggyBank Withdrawal Report Details: Drops Across Three Product Types
According to PiggyBank’s June 10, 2026 withdrawal report and the June 6 announcement on the X platform, the trading strategy was: purchase locked (LOCKED) LAB tokens at a discount through an over-the-counter (OTC) channel, while simultaneously establishing a perpetual short position as a hedge. The report confirmed that LAB later faced “aggressive manipulation,” insufficient liquidity, and an extremely low negative funding rate. PiggyBank assessed that maintaining the short position was “economically irrational” and therefore closed the hedge.
Confirmed withdrawal figures for three product types (as of June 10)：
USDC vault：about 15%
SPYx：about 12%
JitoSOL：about 9%
The locked LAB position, based on market value, had a current value of approximately $1.35 million (more than 13 times the entry price). However, because the token could not yet be sold, PiggyBank excluded it from the net asset value calculation. The first unlock date is August 14, 2026. The withdrawal was triggered by this exclusion.
ZachXBT May 14 Investigation: Six Logged Issues
The specific issues recorded by ZachXBT in its May 14 investigation report are as follows：
Token supply concentration：More than 95% of the LAB token supply is under insider control
Changes to the vesting schedule：Without the LAB team’s consent, the lockup period for Legion public-sale participants was extended from three months to nine months
On-chain fund flows：There is an on-chain connection between the wallet used for LAB lending contracts and the same address used to conduct public LAB buybacks; funds flowed into the founders’ personal accounts on Bybit and Gate
Public recruitment for OTC trading：Co-founder Mark recruited buyers in a public Telegram group, including offering an 80% discount to KOLs in exchange for promotional content
Manipulative market-making activities：ZachXBT identified the market-making infrastructure for LAB—along with tokens such as RAVE, RIVER, SIREN, MYX, and SKYAI—as the same unknown market maker
Prior project example：After founder Vova Sadkov’s team shifted its focus, Eesee (ESE), the earlier project, made investors feel abandoned
PiggyBank Compensation Status: Intention Confirmed, Amount and Timetable Not Yet Published
PiggyBank confirmed in both its June 6 disclosure and the June 10 withdrawal report that it would compensate affected users. As of the time of the report, PiggyBank had not published the total amount of losses or a compensation timetable. After PiggyBank’s June 6 announcement, ZachXBT said bluntly that depositors’ funds were used for “openly fraudulent coins.” PiggyBank’s June 6 announcement received hundreds of replies and reposts, indicating that the community was highly attentive to it.
FAQ
Why did PiggyBank initially choose LAB for basis trading, and did it evaluate ZachXBT’s investigation in advance?
According to PiggyBank’s withdrawal report, PiggyBank classified LAB allocations as operations within the range of mid-cap stock basis trades, considering them a calculated position. The report does not mention whether PiggyBank evaluated ZachXBT’s May 14 investigation report before initiating the position.
Will the $1.35 million market value locked LAB position be fully unlocked on August 14?
Based on PiggyBank’s announcement, August 14 is the first unlock date, not the full unlock date. A complete unlocking schedule has not been explained in detail in PiggyBank’s official disclosures.
What is the basis for ZachXBT confirming that LAB and RAVE share the same market maker?
In its investigation, ZachXBT found that LAB’s market-making infrastructure is connected to the same unknown market maker it identified in its prior investigations of RAVE, RIVER, SIREN, MYX, and SKYAI, calling it a consistent operating pattern for tokens listed on exchanges with mid-sized market caps. Related on-chain evidence has been recorded in ZachXBT’s public investigation report.
