Former Polychain Capital Employee Accused of Secret Deal with Eclipse Labs

Former general partner of Polychain Capital, Niraj Pant, has been accused of engaging in a covert deal with Eclipse Labs. Allegedly, Pant was promised a share of Eclipse tokens in exchange for securing funding from Polychain. Neither the management, advisors, nor other investors of the firm were aware of this agreement.

According to sources reported by CoinDesk, the venture capital firm Polychain Capital has accused its former employee, Niraj Pant, of violating the fund's policy. The allegations state that Pant made a secret arrangement with Eclipse Labs and its former CEO, Neel Somani. In September 2022, Somani purportedly promised Pant 5% of Eclipse tokens in exchange for ensuring Polychain's financial backing for the project. Polychain Capital led the preliminary funding round for Eclipse, amounting to $6 million.

The token allocation was eventually reduced to 1.33%, equivalent to $13.3 million. An insider close to Eclipse Labs disclosed that in the latest funding round, Eclipse tokens were valued at $1 billion on a fully diluted basis (FDV).

Polychain Capital, founded by former Coinbase employee Olaf Carlson-Wee, is one of the largest venture firms with assets under management exceeding $11 billion. Pant served as a general partner at Polychain from 2017 to 2023, overseeing the distribution of venture funds among promising crypto startups. During his tenure, Pant became a prominent figure in the crypto industry and went on to establish an AI-focused startup called Ritual.

The investigation revealed that Pant was allocated the same number of Eclipse tokens as Polychain Capital, without the knowledge of Eclipse’s management, advisors, or major investors. Polychain confirmed that they were unaware of the financial dealings between Eclipse and Pant until after his departure from the firm. A representative from Polychain stated that they later learned Pant had violated the company's policies.

Neel Somani's history is also fraught with controversy. In May 2024, he faced accusations of sexual harassment, which led to his public resignation as CEO. Following Somani's exit, Eclipse Labs appointed Vijay Chetty, the company’s development director, as the new CEO.

This incident highlights the complexities and potential ethical breaches within the venture capital and cryptocurrency industries. The fallout from these revelations may prompt stricter oversight and transparency measures to prevent similar occurrences in the future.