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How we broke the story about Harmony execs facing bullying claims

The subject is up to the minute, but Tim Craig says traditional investigative reporting made his story on the Harmony blockchain the most satisfying he has yet done.

“In my career so far, I never had the opportunity to do such a thorough, investigative piece,” he says. “To come up with something like this was compelling, enthralling.”

Tim spoke to more than a dozen people including eight who worked with or for Harmony while the total value locked on the chain slumped from $1.42 billion a year ago, to around $6.9 million today.

But it was his close monitoring of the company’s performance, rather than a tip-off, which sparked his interest in the reasons for the crash.

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Harmony’s flagship app was DeFi Kingdoms, “a weird kind of hybrid of a DeFi protocol where you can invest or swap tokens and a medieval-themed fantasy role-playing game,” Tim said.

“I haven’t played it myself but I heard people talking about it a lot.”

The developers’ decision to stop building their protocol on Harmony and move to a different blockchain “stood out to me like a red flag,” he said.

“I knew this project was hugely successful. Why didn’t they want to continue building on Harmony? Why did they want to go elsewhere? That got me onto Harmony in the first place.”

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The other thing that surprised him was the size of Harmony’s treasury, the funds it held in reserve, which came to around $1 billion.

“I had never heard of any project, even bigger projects than Harmony, with such a big treasury,” he said.

Harmony was a small, little-known blockchain with a token that ballooned into a huge valuation. But the management failed to lock in some of the profits.

Harmony's token ONE

“Bubble phases occur in crypto. If there’s going to be a bubble you want to lock in some profits and keep developing to make something more lasting. But Harmony kept everything in this one volatile token. It went up to a billion then came crashing down to about $50 million today.”

Tim spent three weeks researching the story in January.

“I went on Discord and Twitter and found community people who were actively talking about Harmony. A lot of them kept saying similar things; the leadership was incompetent, things had been mismanaged,” he recalled.

People he spoke to also noted “radio silence” in the company. Its founders Stephen Tse and Li Jiang “were not communicating with the developers who were building projects on Harmony, and they weren’t communicating with the community.”

The “next logical step”, Tim said, was to talk to Harmony’s employees.

Five were willing to go on record, three others said they would give background information, but all wanted to remain anonymous.

“They were worried about repercussions from community people who had heavily invested in Harmony,” Tim said.

“There was a real fear that a mob could come after them if they spoke up about some of the problems.”

Some were also worried about being sued.

The founders initially ignored his attempts to contact them. Eventually, Jiang replied, dismissing accusations of mismanagement and bullying as “misrepresentation by disgruntled former employees who now work at a competitor”.

When I asked Tim if some of his sources were out to settle scores with Tse and Jiang, he said:

“In my personal opinion, one or two of them had axes to grind, and when you consider the things they were telling me, I can see why.”

But, he went on, “I was worried about that. I didn’t want to push those people’s agenda. I wanted confirmation from other places.”

Other employees who didn’t want to comment initially and were still quite hesitant were willing to corroborate the allegations.

And despite Jiang’s remarks, there was no backlash from the management.

Tim said he and DL News’ managing editor Ekin Genç “put a lot effort into talking things through with a lawyer to make sure the article was very tight. We had lots of evidence.”

Is there more to the story, I asked.

“After the story came out, people on Reddit and Twitter were saying this is only the tip of the iceberg,” Tim noted.

“There are certainly things that if I’d known then I would have wanted to include at the time. But you have to call it at a certain point. You can’t keep waiting for sources for ever,” he added.

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