BNB Chain files legal action against former employee over ASTEROID mini-coins

Seed phrase access drives BNB Chain legal case

ASTEROID transaction data raises wallet ownership questions

BNB Chain accused a former employee of repeatedly using seed phrases from a tutorial wallet and launched ASTEROID tokens.

After obtaining 79.67% of the total supply of ASTEROID, the four wallets sold most of the tokens, making a profit of approximately US$638,000.

Lookonchain estimates transaction profits of approximately $628,000, but ownership of the wallet has not yet been confirmed.

This case shows that the retained seed phrase can still maintain access to the wallet after the private key is deleted and the employee leaves.

BNB Chain is taking legal action against a former employee alleging he used retained wallet credentials to launch ASTEROID Memecoin. At the heart of the controversy is an educational wallet previously used for token tutorials, which was later linked to the release of another Memecoin.

"A wallet address was created by a former employee who then used the address as part of a video tutorial to generate a token. The employee has now left the company due to this incident." The employee retained unauthorized access to the relevant seed phrases after leaving the company.

BNB Chain stated that the employee retained unauthorized access to wallet seed phrases after leaving the company. According to him, the former employee generated new access credentials and reused the address to create a token called Asteroid Shiba (or ASTEROID).

Seed phrase access rights drive BNB Chain legal cases

BNB Chain said it never created, approved, promoted or controlled the token. It also denies any connection to wallet activity surrounding ASTEROID Memecoin.

The group is working with authorities and preparing legal action, but has not disclosed the employee's name or the relevant jurisdiction. It also did not say whether the proceedings would be civil, criminal or both.

Binance founder Zhao Changpeng repeated these allegations on the X platform and warned users to exercise caution. However, these allegations have not yet been tested by court cases or judicial decisions.

On-chain analysis adds a financial dimension to this controversial token offering. Lookonchain reported that four newly created wallets spent approximately $10,000 to purchase 796.7 million ASTEROID tokens.

This purchase accounted for 79.67% of the total token supply. The wallets then sold 718.8 million tokens for 1,103 BNB, which was worth approximately $638,000 at the time.

Lookonchain estimates that these transactions generated profits of approximately US$628,000. However, public blockchain records alone cannot prove who controls these addresses.

It was not possible to independently confirm that the four wallets belonged to the former employee. Linking addresses to individuals often requires evidence other than transaction records.

The controversial token offering was also opposed by an early project that used the Asteroid Shiba name. However, the team denied involvement and said the new token copied its identity.

ASTEROID transaction data raises doubts about wallet ownership

This address previously appeared during the February 2025 BNB Chain tutorial to demonstrate the creation of the token TST. The network later described TST as a Memecoin accidentally created while displaying token deployment through Four.Meme.

Traders discovered TST after its name appeared in the tutorial. Subsequently, speculation pushed the token's market value to more than $50 million.

Zhao Changpeng said that TST is not an official online token. As a result, the tutorial was deleted and the creator address allegedly held 0.13% of the TST supply.

The latest controversy highlights the difference between deleting a private key and protecting the recovery phrase behind it. Basically, when someone keeps the wallet's seed phrase, the wallet can be restored.

This detail makes the employee resignation process the core of the ASTEROID Memecoin case. Access to previously shared recovery phrases is retained even if local files or keys are deleted.

For blockchain organizations, tutorial wallets may still have reputational value long after their original purpose ends. Therefore, repeated use of known addresses may affect how traders interpret new tokens.

Currently, unresolved issues concern wallet ownership, jurisdiction and evidence available to investigators. Until court documents emerged, these allegations remained claims rather than fait accompli.