The former star project Xterio TGE attracted heavy criticism from the community, and many players lost all their money

"This is the first time I've seen a loss of zero." Crow (alias) commented in the Xterio rights protection group. The Web3 game development and operation platform Xterio was once a star project in the market. With its strong team background and strong capital support, it attracted many investors to participate. A netizen named "Little Person" wrote a review on X about the reason for building a position in Xterio at the beginning: "Suddenly I remembered why the people around us have an average loss of 1 million on this project. Half a year ago, when this project announced the investment of Binance, there was an occasion to have a meal with the people of Xterio, and then we went back and Fomo-ed on the position. That meal was so expensive, I really want to cry." However, the reality that awaited investors was generally a loss. On January 8, Xterio launched a Token Generation Event (TGE) activity, and the dissatisfaction of investors due to losses continued to rise. As the KOLs participating in Xterio continued to expose and show the loss data, the dissatisfaction of the community was immediately ignited, and various Xterio rights protection groups were brewing vigorously. Loss, fraud, humiliation... the dream of wealth has shattered, and the once dazzling star project seems to have fallen from the altar. : TGE Doubts Heavily, the Community Hammers Xterio The founding team members of Xterio come from top game developers such as FunPlus, EA, and NetEase. At the same time, it has also received investments from well-known institutions such as Binance Labs, FunPlus, and FTX. Compared to many Web3 native projects, Xterio can be said to have "been born with a silver spoon in its mouth". On August 30, 2022, it completed a $40 million financing with a valuation of $300 million, with well-known institutions such as FunPlus, Makers Fund, FTX Ventures, and XPLA as the lead investors. Many industry giants participated, and it was once unparalleled. Immediately afterwards, on July 13, 2023, Binance Labs injected another $15 million into it, helping it in the game development and token launch plans in the AI and Web3 fields. Based on the past poor performance of the NFT market, investors have already suffered losses on Xterio. An investor told a ChainCatcher reporter that he had bought the Xterio-launched Dino NFT (from the self-developed game Age of Dino) at an average price of 1-1.2 ETH, while according to Opensea data, the floor price of the Dino NFT has been below 0.3ETH for the past three months. It can be seen that the loss is not the main factor that triggered the community's emotions. The real fuse was the TGE event on January 8, which completely ignited the powder keg between the community and the project: Xterio officially released the token economic plan on January 2, planning to issue 1 billion XTER tokens: 28% for the community, with 20 million tokens fully unlocked at TGE; 26% for the ecosystem, with 20 million tokens fully unlocked at TGE; 15% for investors; 12% for the team; 9% for marketing, with 15 million tokens fully unlocked at TGE; 4.25% for the treasury, and 5.75% for providing liquidity and staking at TGE. After announcing the token economic plan, Xterio also released the rewards for Age of Dino during the TGE event, promising that Age of Dino would receive a 2% XTER token ecosystem subsidy during the TGE period. In addition, at least 8% of the Age of Dino tokens will be fully unlocked and distributed to NFT holders and players at the AoD TGE. After the TGE, many investors reflected that the actual airdrop ratio was different from the announced one. ChainCatcher conducted centralized interviews with investors after the TGE event. Xiao Tao (alias), one of the many losers, is a personal player of Age of Dino. In an interview with ChainCatcher, Xiao Tao said: "If you airdrop the normal amount, I can accept the price not going well, but if you airdrop 0.5%, isn't this fraud? This is a complete insult to investors!" Xiao Tao showed ChainCatcher a screenshot of the airdrop contract address during the project's TGE period. "The airdrop contract had a total of 20 million tokens, and only 5 million tokens were claimed in one day." Xiao Tao also told ChainCatcher that he had invested $50,000 in the Xterio project, full of expectations for a generous return, but the reality dealt him a heavy blow, and he only got back $4,000 in the end, with a loss rate as high as 92%. Investor Peng Peng said: "From the situation of claiming tokens, the team only airdropped 0.5% to the community, and embezzled the remaining 1.5%. And with so many activities plus thousands of NFTs, they only airdropped 2% to the community. The project team used the liquidity they should have provided to stake on the exchange." Peng Peng showed another set of screenshots to ChainCatcher. Ximen Zi (alias) did some calculations and said that 80% of the aforementioned airdrop should have been taken by the project party: "Not counting the AI points (Xterio collaborated with Bybit wallet at the end of last year for a Xterio AI Agent points activity), the community players got less than 3 million tokens. This 3 million also includes the project party's rat trading, and the project party's Dino NFT is at least 1,000, of which more than 85% are rare NFTs, taking up a large share. So in summary, including the AI's shill players, the community actually only got less than 4 million tokens, accounting for about 3.5% of the initial circulation of 112.5 million." Xiao E (alias) pointed out another problem, that Xterio inflated the data during the TGE period, causing player rights to be diluted. He showed ChainCatcher the chat screenshots between him and Xterio's business person Kelly on Telegram, where he asked Kelly if all the scores would exceed 100 million, and Kelly replied "unlikely", but Xiao E found during the airdrop period that the scores had become 270 million, which Xiao E claimed was an increase of at least 170 million. It is understood that the scores mentioned by Xiao E refer to the score rewards issued by Xterio in some past activities, and the official had promised that these score rewards could be exchanged for airdrop rights in the future, and users could obtain Xterio ecosystem scores through activities such as Meet your Anima (Palio), Overworld Arena and Dinoski (Age of Dino). In addition to individual investors, other roles in the Xterio interest chain have also suffered varying degrees of losses. Previously, there were reports that the game studio was promised a Gas refund by the project party, and the studio used more than 10,000 accounts to brush data, with 3 dollars of Gas required for each Mint of an NFT, but it was not actually paid. During the interview, an employee of a game studio told ChainCatcher that they had lost $80,000 on Xterio, but did not disclose the specific reasons for the loss. Crypto KOLs have been posting X to denounce the project during the Xterio TGE period, becoming a prominent group in this storm. The ice frog with nearly 60,000 fans said he exchanged 1 token for every 30U, and the expected rate of return was as low as -97%, with a total loss of up to $300,000 (note: may be unrealized loss).

Here is the English translation of the text, with the specified terms translated as instructed:

The big V "Aussie Lion Brother" with over 110,000 fans directly started cursing, claiming that the project party had been PUAing the community for more than a year, and the community had spent money and time to complete tasks, but everyone only received 20 million airdrops, while the project party released 15 million airdrops to themselves on the first day of the TGE through the Marketing share. "Now this airdrop has caused me to have a very big psychological shadow about the so-called Web2 successful entrepreneurs coming to Web3." While accusing the TGE event of unfairness, he expressed his dissatisfaction with the team behind the project, reminding market participants to "disenchant" the entrepreneurial halo of the creators.

Siemens said that the project founder Dong Ruibao often takes "unreasonable" as his motto, and whenever something happens, he continues to PUA the community by saying "I just do things unreasonably".

KOLs' comments have been "crushing" one after another, and the negative emotions in the community have been spreading. Xterio's reputation during the TGE period can be said to have plummeted.

The true face of the crisis and the internal chaos

In addition to the unfair distribution, the internal chaos of Xterio has also emerged in the crisis.

0xkunkun pointed out that Kelly was responsible for Xterio's listing and business negotiations, but he was frantically hinting in the Telegram group that Upbit would be listed before the TGE, causing the floor price of the Small Dinosaur NFT to be raised to 0.6ETH, and after the TGE was announced, the Small Dinosaur was directly smashed by the community to 0.15ETH.

Mr. D (alias) said that the project staff openly shilled in the Discord, buying points at 0.3U (USD) / point outside the market, creating the illusion of high point value.

"Shilling to yourself is completely illegal, it's like a listed company shilling and then their own employees buying it off-market, which is illegal." Mr. D said excitedly during the interview, but what still bothers Mr. D is the project party's promise that could not be fulfilled, "The project party promised to refund the acceleration cards, it cost 30U per account, I got a few, but when the promised time came, they just ignored it. I asked them, they just played dead, it's pure fraud!"

Some investors pointed out that there may be problems with the decision-making within the project party, and Xiao Tao said: "The official released the token economics, and they (the project staff) also knew it at the same time as us, which shows that the decision-makers didn't even discuss it with other colleagues, they were dictatorial!"

Within 2 days after the TGE, the Xterio official Discord channel was completely flooded with negative comments from the community, lacking official staff to soothe the emotions of the community members, until the evening of January 10th, when the conflict emotions began to ease with a new announcement.

It is worth mentioning that regarding the issues that investors and the community are generally concerned about (the 2% airdrop not being implemented), ChainCatcher sent an interview invitation to Xterio on the afternoon of January 10th, but as of the time of writing, no official response has been received. However, on the evening of January 10th (the same day the interview invitation was sent), Xterio released a new announcement on X addressing the compensation for Age of Dino players, and provided more detailed information on the 2% XTER ecosystem allocation:

· 1% of XTER (10,000,000 tokens) will be distributed to Dinosty (Small Dinosaur) NFT holders, with the airdrop based on NFT holdings and a snapshot taken within 36 hours of the announcement;

· 1,550,898 XTER from the 777 NFTs in the treasury will be rewarded to users of the new game version to be launched in about 4 weeks.

· Game rewards: 0.5% (5,000,000 XTER) for Roar holders, with a snapshot taken within 36 hours of this announcement.

· 0.4% (4,000,000 XTER) based on your skin collection points, with a snapshot taken within 36 hours of the announcement.

· 0.1% (1,000,000 XTER) based on in-game power rankings, allocated to the top 200 players. We will collect the top 100 players from Zone 1 and Zone 2, and merge them into an overall ranking.

· Claim period: 8am UTC January 14 - 8am UTC February 13 (30 days). Any unclaimed tokens will go directly into the NFT pool.

After this announcement was released, the antagonistic emotions of the Age of Dino players were basically dissipated. According to the ChainCatcher interview, most Age of Dino players felt the announcement was helpful, but "they just barely broke even", while participants in Xterio's other two games, Meet your Anima (Palio) and Overworld Arena, are still in a state of hoping to maintain their rights - although the expansion speed of the maintenance group has obviously slowed down.

"Let's see what happens to the Small Dinosaurs on the 14th." A community member said.

"The AI points will also be distributed on the 14th." Little E added.

It is difficult to explore the true face of the crisis, but from the reaction of the Xterio team before and after the TGE event, the team did not carry out crisis public relations in a timely manner, leading to the current trust crisis, and a rift has appeared between the community and the project.

Whale Dong Ruibao highly centralized, AOD suspected of being a rat hole

Many investors told ChainCatcher reporters that the reason they were initially attracted to Xterio was because Xterio used FunPlus' team. FunPlus is a video game developer and publisher headquartered in Switzerland, with games including "King of Avalon", "State of Survival" and "Guns of Glory".

FunPlus provides the technical stack for Xterio. On the other hand, Xterio is FunPlus' exclusive partner, responsible for issuing and deploying non-fungible tokens (NFTs) for all current and future FunPlus games.

In 2022, Xterio announced that it had raised $40 million, with the round led by FunPlus, FTX, Makers Fund, XPLA and others. When announcing the investment, Xterio said that FunPlus provides the technical stack for Xterio, and Xterio is the exclusive partner of FunPlus, responsible for issuing and deploying non-fungible tokens (NFTs) for all current and future FunPlus games - this shows the close relationship between FunPlus and Xterio.

Xterio's official website shows that the platform currently has multiple games online, with self-developed games including "Age of Dino", "City Shadows", "Overworld", "Palio", covering genres such as FPS, MMO, sandbox, and casual.

A person related to Xterio told ChainCatcher that the current Xterio core team is mostly from Hong Kong and relatively exclusive, and only the core team has the right to Tokenshare, while other employees do not have the right to token allocation, and the token allocation right is firmly controlled by Dong Ruibao and Ryan Cheung, with Jeremy being basically marginalized.

"If it were Jeremy, he wouldn't have allowed the above things to happen. The Overworld rewards were just given away casually for 80U, without any bottom line." the informant said.

Who is Jeremy?

Jeremy Horn is the co-founder of Xterio and "Overworldplay", and previously participated in the development of games such as "Harry Potter: Mystery at Hogwarts", "Star Wars: Smugglers", "Family Guy: Finding Stuff", and "Marvel: Avengers Academy" in Web2, with rich game development experience.

"Jeremy Horn at least understands token economics." Xiao Tao said.

"Although Jeremy is also bad, at least he would find professional consultants to help him design it." Other community members said.

At the end of 2024, Dong Ruibao, the former Chief Strategy Officer of FunPlus and CEO of Qujia Interactive Entertainment, suddenly announced his departure from FunPlus, poaching some members from FunPlus, and fully invested in the Web3 startup Xterio, becoming the actual leader of Xterio, and published an article about this, which was reposted by FunPlus founder and CEO Zhong Yingwu (Andy), expressing support for Dong Ruibao's entrepreneurship. Interestingly, before and after Dong Ruibao announced his resignation, FunPlus also broke out that it was undergoing a large-scale layoff.

The aforementioned Xterio-related person pointed out that on the day of the TGE, Dong Ruibao set up a 6 million yuan AOD NFT fund, "I suspect this is to whitewash the rat warehouse. Because the scores of the main fortress are just data."

Several community members expressed doubts to ChainCatcher about the existence of rat warehouses in Xterio's self-developed games.

When ChainCatcher reporters asked Dong Ruibao why he would do this, and whether there was any dismantling of the East Wall to fill the West Wall between Web2 and Web3 businesses, the aforementioned Xterio-related person responded that there was no need, "I have seen Dong Ruibao's wallet, that is a whale. He is not short of money, in fact he does not need financing."

In fact, Dong Ruibao has a brilliant resume in Web2. He once served as the Chief Operating Officer of NetEase, and according to his own recollection, the "Dream of the West" he led the launch of during his time at NetEase is currently the game with the longest global operation time. In addition to his achievements in the gaming industry, Dong Ruibao has also crossed over to the financial circle, with more than 7 years of investment banking and investment management experience, managing nearly $100 million in venture capital. Prior to this, Mr. Dong had worked at Softbank China Fund Management Co., Ltd., Nomura Group, Ample Securities Limited Investment Banking Department, and as an auditor at Ernst & Young.

"This is Dong Ruibao," the relevant person commented.

"He should never have researched the activities he launched, let alone make money, real players have all lost their capital. He should have only looked at those false data, perhaps just for the sake of getting listed on Binance, but unfortunately he still didn't make it," said Xiao Tao.

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