STFIL Updates and Frequently Asked Questions

This page gives the latest information on STFIL, as collected and checked by the Filecoin Foundation. Latest updates are at the top; answers to frequently asked questions are below that.

Updates

August 21, 2024 - STFIL case moves to courts

The deadline given by the Hanshou police for STFIL customers to provide details to them passed on July 10th; the two Chinese legal firms working with lessors, Zhong Lun and DHH, worked with their clients to give them this data. While this police deadline, and the date set by both law firms to join their case have now passed, it may still be possible to find representation: please contact Danny O’Brien at [email protected] if you are in this situation, and we will try to help you find support.

The next major stage of the process will be for the STFIL case to work its way through the Chinese legal system.  We understand that the police transferred the case materials to the procuratorate for further review on August 10. Now the procurator (roughly equivalent to a prosecutor in other legal systems) will work on reviewing the charges brought by the police.Before the police announced details of their investigation and deadline, the Filecoin Foundation had commissioned Zhong Lun to independently investigate what was happening in Hanshou, as well as conduct legal research and analysis to develop the substantive arguments for the case. As an update, Zhong Lun have now rolled this latter research into their ongoing representation of their STFIL clients.

June 28, 2024 - Legal support information, July police deadline

A summary of the current STFIL situation, especially for those only now hearing about it:

In April, local law enforcement in Hanshou, a city in the Hunan province of China, arrested members of the STFIL team. The police made this group of STFIL employees move all the FIL held by the company into a Filecoin wallet controlled by the police. (More details here.)

On June 10th, the Hanshou police bureau posted a message on their official WeChat account requesting that STFIL customers register details of their STFIL accounts by July 10th, 2024.

While the police did not promise to return these customers’ FIL, they did say any FIL not registered would be to “dispose[d] of in accordance with relevant laws”. This means that if you fail to register on time, you may lose your chance to seek return of your FIL tokens.

Filecoin community members have formed a group (the “511 Changsha Tourist Group") to get their FIL returned, and have fundraised to obtain legal counsel for their members from DHH, a Chinese law firm. The Tourist group has extended the deadline to join this collective until July 7th.

Another well-known Chinese law firm, Zhong Lun, is also available to help individual and institutional lessors retrieve their FIL. Details on contacting Zhong Lun about representation are listed below.

Both firms can help with registration with the police. While we recommend that all STFIL lessors obtain expert legal advice on whether and how to register properly, ultimately the decision is yours. The police have said they will accept registrations directly.  We’ve included here the information provided by the police on how to register, with their contact phone number and consultation hours,  as well as the address in Hanshou to send these details. (Note that the police has also said that these documents may require notarization, but notarization can take place after the July 10th deadline.)

For more information, see the FAQ, or join the #stfil-response Slack channel (here’s an invite to the Filecoin Slack server). For more frequent discussion with other lessors, the Tourist group has set up a community Discord.

This page will be updated with any significant new developments.

June 14, 2024 — An Important Update for STFIL Lessors

(此更新的中文翻译如下)

Police Request Registration of Claims

While there remain many questions as to the legitimacy of the police seizure under Chinese law and the future action of the courts, there was one clear new development this week.  This Sunday, June 9, the Hanshou police posted this message to their official Wechat account:

Translation:

While this statement makes no guarantee that lessors’ FIL will be restored, it does provide a potential new action for anyone who had their leased FIL seized.

The police statement followed concerted pressure on the investigation by concerned STFIL customers, including an organized group of Chinese lessors (the “511 Changsha Tourism Group” group), who traveled to Hanshou in person in May to make their case directly to the police officers.

What you can do if you are an STFIL Lessor

The 511 Changsha Tourism Group group have now raised funds and retained Chinese legal counsel. Their lawyers will also represent the group in any subsequent legal proceedings – proceedings which may ultimately determine whether FIL will be returned to lessors. At the Foundation’s request, this groups’ organizers have extended the deadline for lessors to join their group until July 7. While this group is primarily made of Chinese STFIL customers, this offer is also extended to non-Chinese lessors.

The external legal team that led the investigation for the Foundation are also available to advise and represent foreign and Chinese lessors in this case. They will offer similar services: ensuring that the police receive appropriate information, and representing lessors in any future developments.

If you’d like to join with either of these initiatives, we have included a description from each party below, together with contact information, as well as the information that the police have requested from lessors.

Because of the complexities of the case, we do encourage all customers of STFIL to seek expert legal advice. The choice of counsel is ultimately yours, and the Foundation cannot tell you which choice is best for your situation. However, we do believe that both law firms have knowledge of the current situation, cryptocurrency, and of Chinese law and practice.

Lessors can also contact the police directly with the requested details. (Please note that providing this information could put you at risk for further investigation, especially if you are a Chinese lessor. While the choice is yours, we strongly encourage lessors to make their determination of the risk with the advice of counsel.)

We’ll continue to post updates on the case here at our regularly updated FAQ page, and on the #stfil-response Slack channel (invite here). Please don’t hesitate to join the conversation there to ask any questions or to keep up with developments.

Legal counsel (two alternatives):

1. The 511 Changsha Tourism Group represents over 180 lessors from seven countries, who collectively hold around 2 million STFIL. They write: “Our legal representative is confirmed to be DHH, a famous global law firm that has analyzed the current situation and is determined to recover the assets from the authorities. Our fee structure with DHH is also confirmed. If you would like to discuss joining our group, please contact Road at [email protected] , cc: [email protected], join our Telegram channel or WhatsApp groups. We can accept new members only until July 7th.”
2. Zhong Lun Law Firm (“Zhong Lun”) is one of the Chinese leading law firms. They write: “After decades of rapid and steady growth, today Zhong Lun has established itself as one of the largest top-notch full-service law firms in China, with over 420 equity partners and more than 2,400 professionals working in eighteen offices in China and overseas. Zhong Lun’s in-depth expertise and close inter-department collaborations enable Zhong Lun to provide clients with high-quality legal services across a wide range of industries and sectors.

Zhong Lun’s work in this case is led by Jerry Fang. An attorney admitted in China and New York State, Mr. Jerry Fang is a partner of Zhong Lun, where he specializes in litigation, investigation and regulatory compliance practice. Jerry served as a Chinese judge at a trial court where he handled hundreds of civil and commercial cases in his early legal career. He earned his LL.M and J.D. degrees from Columbia University, and has practiced law with leading international law firms in the U.S., Hong Kong and mainland China, before eventually joining Zhong Lun.  Jerry will lead with his colleagues in Zhong Lun’s domestic and overseas offices to represent domestic and international lessors in this case.  To contact the team at Zhong Lun:

email: [email protected]”

Telegram:           @ZhongLunTeam

WeChat:             ZhongLunTeam

WhatsApp:         +85256664412

Police Documentation Requirements

For China-based lessors, see the original police statement.

For lessors outside China, the police ask for:

• A letter explaining how you obtained FIL including the people involved in the introduction, transactions, your exact details of how you learnt about STFIL and joined the lending pool.
• The wallet address used for STFIL, and amount.
• Photocopies of Government ID.
• An overseas address, and contact method (they can’t call international numbers).
• Any relevant material that can prove you are lessor of the protocol
• A finger print with red ink, next to your signature.

Send these to:

3.28 Case Police Task Force

Address: 湖南省汉寿县汉寿大道与天平西路交汇处

Hanshou County Public Security Bureau

Intersection of Hanshou Avenue and Tianping West Road, Hanshou County, Hunan Province, China  415900

Telephone: +867362197110

(Update June 27 2024: The police have now indicated that they may require these documents to be notarlzed, though it should be possible to do this after the July 10th deadline.)

STFIL 案件更新

2024 年 6 月 14 日

警方要求注册索赔

虽然关于警方查封的合法性以及法院的判定仍然存在许多问题，但本周有一个明确的新进展。6月9日星期天，汉寿警方在其官方微信账号上发布了以下消息：

微信链接

虽然该声明并没有保证归还出租方的 FIL，但这为任何被查封 FIL 的出租方提供了明确的行动步骤。

警方的声明是在受到STFIL关切的客户施压后发布的，其中包括一个有组织的中国出租方团体（“511长沙旅游团”），他们在五月亲自前往汉寿，直接向警官陈述他们的情况。

如果你是STFIL出租方，你可以采取的行动

511长沙旅游团已经筹集了资金并聘请了中国法律顾问。他们的律师还将代表该团体参与任何后续法律程序——这些程序可能最终决定FIL是否会归还给出租方。应基金会的要求，该团体的组织者已将出租方加入团体的截止日期延长至6月23日。虽然该团体主要由中国的STFIL客户组成，但这一提议也扩展到了非中国出租方（该团体主要由中国出租方人员组成）。

为基金会领导调查的外部法律团队也可以在此案中为外国和中国的出租方提供建议和代表服务。他们将提供类似的服务：确保警方收到适当的信息，并在任何未来的发展中代表出租方维权。

如果您希望加入其中任何一个倡议组织，我们会提供每个团体的描述及联系信息，以及警方要求出租方提供的信息。

由于案件的复杂性，我们鼓励所有STFIL的客户寻求专家的法律建议。法务代表的选择最终是您的决定，基金会无法告诉您哪个最适合您的情况。然而，我们相信这两家律师事务所都了解当前的情况、加密货币以及中国的法律和实践。

出租方也可以直接向警方提供所需的详细信息。（请注意，提供这些信息可能会让您面临进一步调查的风险，尤其是如果您是中国的FIL出租人。虽然选择权在您手中，但我们强烈建议出租方在法律顾问的建议下评估登记的风险。）

我们会在定期更新的常见问题页面和#stfil-response频道（请在此邀请）上继续发布案件更新。请随时加入讨论，提出任何问题或了解最新进展。

法律顾问（两个选择）

1. 511长沙旅游团

511长沙旅游团代表来自七个国家的180多名出租方，这些出租方总共持有约200万个STFIL。他们写道：“我们的法律代表已确认为DHH，一家著名的全球律师事务所，他们已经分析了当前的情况，并决心从当局手中追回资产。我们与DHH的费用结构也已确认。如果您想讨论加入我们的团体，请联系Road，邮箱：[email protected]，抄送：[email protected]，或加入我们的Telegram频道。我们只能接受新成员加入到6月25日。”

511长沙旅游团联系方式：

• 邮箱：[email protected]g
• 抄送：[email protected]
• 加入Telegram频道

1. 中伦律师事务所

中伦律师事务所（“中伦”）是中国领先的律师事务所之一。他们写道：“经过几十年的快速稳步发展，如今中伦已成为中国最大的顶级全方位服务律师事务所之一，拥有超过420名股权合伙人和2400多名专业人士，在中国和海外设有18个办公室。中伦的深厚专业知识和紧密的跨部门合作，使中伦能够为客户提供高质量的法律服务，涵盖广泛的行业和领域。

中伦在本案中的工作由方捷先生领导。方捷律师在中国和纽约州都有律师资格，他是中伦的合伙人，专注于诉讼、调查和合规事务。方捷早期法律职业生涯中曾担任中国基层法院法官，处理了数百起民事和商业案件。他获得了哥伦比亚大学的法学硕士和法学博士学位，并在加入中伦之前，曾在美国、香港和中国大陆的知名国际律师事务所执业。方捷将带领中伦国内外办公室的同事代表本案中的国内外出租方。

联系中伦团队：

• 邮箱：[email protected]
• Telegram: @ZhongLunTeam
• 微信: ZhongLunTeam
• WhatsApp: ZhongLunTeam

警方文件要求

对于境外的出租方，警方要求提供以下信息：

• 一封信，说明您如何获得FIL，包括介绍人、交易过程、您了解STFIL并加入贷款池的详细信息
• 用于STFIL的钱包地址和金额
• 政府身份证的复印件
• 海外地址和联系方式（他们无法拨打国际电话）
• 任何可以证明您是协议出租方的相关材料
• 带有红色墨水指纹的签名
• 请将以上材料发送至：

3.28 Case Police Task Force

Address: 湖南省汉寿县汉寿大道与天平西路交汇处

Hanshou County Public Security Bureau

Intersection of Hanshou Avenue and Tianping West Road, Hanshou County, Hunan Province, China  415900

Telephone: +867362197110

Frequently Asked Questions

What happened to STFIL?

Storage providers (SPs) need to pledge collateral to provide storage on the Filecoin network. STFIL is one of a number of independent services on the network that allow storage providers to lease FIL from FIL holders (lessors) to use as this pledge collateral.

Our understanding is that, as early as April 3, lessors using the STFIL application discovered they could not withdraw from STFIL’s system, and that the STFIL team was unresponsive to inquiries.

On April 6, a member of the Filecoin community posted on a public Slack channel requesting a delay to the planned upgrade of the Filecoin protocol on April 11th because of what they described as “uncontrollable circumstances amounting to force majeure encountered by the STFIL team”.

On April 9, the STFIL X/Twitter account posted that STFIL’s technical team had been detained by the authorities in mainland China, and that during that detention, a series of changes were made by actors in possession of keys managed by the STFIL team. These changes altered the smart contracts so that the current FIL balance of STFIL was transferred to a separate, new address, f410falck3ysg7e2k4outtq2r24ytd66cuddydnoga6a.

Was this a “rug pull” — did the STFIL team intend to steal the FIL?

Apparently not: the changes made to on-chain contracts appears to have happened after the STFIL team were detained. The first on-chain changes were on April 3 (Beijing Time), and we have seen detention documents dated April 4, but people close to the incident say that the team were arrested on April 2.

The detained STFIL team were not permitted access to a lawyer during the period that the smart contract changes were made.

Who now controls the new FIL address?

Since these events, the Filecoin Foundation retained counsel in China to better understand the situation. These lawyers have learned that the local police authorities have control of this address.

Why did the STFIL arrests delay the upgrade to the network?

Depending on how STFIL operated, the teams’ disappearance could potentially have led to multiple Filecoin storage providers connected to STFIL being unable to upgrade, and simultaneously disappearing from the Filecoin network. In an abundance of caution, a group of core developers decided to delay the upgrade from April 11 to April 24, and started an incident report to assess the wider risks to the network from events associated with STFIL. This gave more time for some STFIL storage providers to prepare for the upgrade.

What else happened in response to the STFIL arrests?

After being invited to assess the effect on the network, the incident group worked to see if they could understand the STFIL contracts and help those affected — particularly SPs — unhook from the contracts with minimum disruption to the network. You can read about some of that work here.

Having ascertained that the STFIL did not pose a risk to the stability and functioning of the network, the incident group has moved into a monitoring mode.

This group also co-ordinated on fact-finding and communicating what was known to those affected: this is the role that we at the Filecoin Foundation has now taken on.

Did the STFIL team break the law?

Since the investigation is still in early stage and the authorities have not revealed their investigation findings or made a formal charges under the Chinese criminal law, it is too early to draw any conclusions that the STFIL team did anything wrong or broke Chinese criminal law.

Why is FIL still moving into this address?

STFIL still had SPs returning FIL to their contracts, either because they did not know of the arrest, or because they were paying back the remaining loan in order to end their contract; this FIL was being automatically transferred into the new address.

Will the authorities keep the FIL or cash out?

(Updated Jun 6 2024 to clarify language) We’re still unclear on the future process. Based on preliminary advice from our Chinese counsel, we believe that at some point the Chinese courts will determine what to do with the FIL in the controlled wallet, but whether the authorities will convert it into local currency before this or have the court take control of the FILs is unknown.

I’m a STFIL lessor. Will I be able to get my FIL back?

This will be up to the Chinese courts. Based on preliminary advice from Chinese counsel, we believe that lessors might be able to intervene in the process, and petition to have their tokens restored to them. Such a legal process may take a long time — months or years, rather than days or weeks.

Can someone freeze the account containing STFIL funds so it cannot be moved, or even transfer the FIL back to lessors?

To do this would require inserting a special exception into the software implementing the Filecoin protocol. This would require the approval of the implementers of this code, who work at multiple independent organizations across the Filecoin ecosystem (including FilOz, ChainSafe, and the Venus team).

The Filecoin Foundation does not write or implement this software, but we do help coordinate conversations between all of the core developers on upgrades and improvements to the protocol. Under the current Filecoin governance system, there would have to be “soft consensus” (i.e. broad unanimity) on the proposal for it to pass. A discussion to freeze the accounts took place but many of the core developers have already objected, which makes this solution unlikely to proceed.

Can someone stop cryptocurrency exchanges from converting the FIL in the wallet into fiat currency?

Exchanging FIL for other tokens and fiat currency is controlled by independent exchanges. The parts of the Filecoin ecosystem that work most closely with exchanges, as well as many STFIL lessors and SPs, have informed these exchanges of the activity around the new wallet address, and requested that they do not automatically permit interactions with it on their service.

Exchanges do often respond to such warnings, but in this case they may comply with a request from Chinese law enforcement to liquidate the funds, especially if the exchange has offices or staff in China.

What is the current status of the STFIL team?

(Updated May 25, 2024) Four of the six detained team members have now been released on bail.

Why did the administrator of the STFIL channel say that there was a “website upgrade” in process on April 5?

Our current understanding is that the STFIL channel admin was not yet aware of what was happening with the team, and acted independently.

How did the police get control of the new address?

Our assumption, based on on-chain activity, is that when the police arrested the STFIL team, enough of the key holders of the multisig that controls upgrades of the STFIL smart contracts were in their custody, that they could compel them to agree to change the contracts to secure the funds. We also understand from our PRC counsel that it is fairly normal for the police to try to take control of crypto assets while the investigation is ongoing.

I’m an STFIL customer — can the Filecoin Foundation help me?

Decentralized networks like Filecoin have no central control or leader, and the Foundation’s role in the Filecoin ecosystem is deliberately limited. Primarily we help maintain the security and long-term integrity of the network, interface with policymakers and other external institutions on behalf of the whole ecosystem, and help coordinate network governance and co-operation through events and network-wide communications.

The Filecoin Foundation doesn’t invest or make loans in companies and does not recommend or endorse particular goods or services over their competitors. Our role also does not include guaranteeing individuals or organizations against the consequences of third-parties operating on the network — including those affected by the STFIL team’s arrest.

What we can do is what we do elsewhere: help coordinate those affected, and provide resources that can benefit the whole community.

In the case of STFIL, we have retained a legal team in China to find out what was happening, and on the basis of that research, recommend the best next steps for lessors who currently cannot withdraw their FIL from STFIL or the new address. We expect further updates and advice from our Chinese counsel and will pass it on as soon as we have it.

How do I keep up to date on STFIL news?

(Updated Jun 7, 2024 with a more realistic update schedule) You can join the #stfil-response Slack channel above (here’s an invite to the Filecoin Slack server). If you are a customer of STFIL and want to coordinate with others to help retrieve your tokens, you can sign up for updates at this Google Form.

Because most of the action in the case now is through legal process, you should expect developments to proceed more slowly than in the first days after the detentions: think months and even years rather than hours or days. We’ll give regular updates on #stfil-response and review this webpage weekly until further notice.

I have signed up on that Google form: when will someone contact me?

We’ll only contact you directly when we have concrete advice on how STFIL customers can take steps to retrieve their FIL, or other very important news. For regular updates, please join the Slack channel above.

How can I keep track of changes in the ga6a address?

The #stfil-response channel has a bot that will message if there are any changes to that account.