What Really Happened With The Ditto Alpha Token Sale

After a sharp market selloff of $900,000 worth of Ditto alpha tokens raised community concerns, the team has shared full details about the incident, saying it was not the result of a wallet compromise, protocol exploit, or security breach.

In a post published June 15, the team said its coldkey had not been compromised and that no Ditto systems were breached.

According to the team, the incident stemmed from an over-the-counter (OTC) transaction that involved a third-party escrow provider. There is no existence of any vulnerability affecting users, validators, or the broader Bittensor ecosystem.

"Our escrow party on an OTC transaction was socially engineered in an extremely elaborate scheme," Ditto wrote. "This resulted in sending funds before our side received the expected amount."

At the center of the scheme was a company called Blockstride Capital, which Ditto identified as the front used by the scammers.

"We used an escrow. They were socially engineered. That's it," the team later explained. "We thought we were safe with our instructions and clauses but that was clearly not enough."

Ditto also stated that law enforcement has been notified and that an investigation is underway. The team cited incident number I-2025-015666 with the Ewing, New Jersey Police Department and said additional information from the police department of Sheridan, Wyoming (where the Ditto company is located), will be released as it becomes available.

Seby Rubino Shares Additional Details

Following Ditto's statement, Ditto contributor & business manager Seby Rubino published a video on June 16 providing additional context.

According to Rubino, the team was approached by individuals presenting themselves as institutional investors interested in a large OTC purchase of Ditto tokens. After reviewing documentation and engaging a third-party escrow provider, the process moved forward.

Rubino said the scammers then executed a sophisticated social engineering attack against the escrow process. Fake communications and confirmations, during which the attackers impersonated Rubino, convinced the escrow party to release tokens before Ditto's side had received the expected payment.

"I'm gutted by this. My heart is broken. I pride myself as a builder myself, on this human-level trust. I put my heart and soul into Bitttensor. I want you guys to know that I'm only going to go deeper, this is only more fuel to my fire to make the world a better place by using Bittensor. That doesn't change."

Rubino concluded the video confirming that they've quickly found a path forward with Beyond Finance, Ditto's lead backer, and they're "fully aligned" for what's ahead, saying "we know how to pay them back, we have the capital to do so. It's just a matter of time before we can put this behind us."

Seby, if you're reading this, you and the team have our full support. We know you'll make it through this stronger than ever. Keep pushing!

Next Steps

Moving forward, the team will proceed with development uninterrupted of Ditto, with the just-released DittoBench and V2 (slated for July) being a major focus.

In his video, Rubino described V2 as "a month's worth of products and features, and also years and years of development and waitlisted or backlogged features."

Disclaimer: This article is for informational purposes only and does not constitute financial, investment, or trading advice. The information provided should not be interpreted as an endorsement of any digital asset, security, or investment strategy. Readers should conduct their own research and consult with a licensed financial professional before making any investment decisions. The publisher and its contributors are not responsible for any losses that may arise from reliance on the information presented.