Mochi Finance founder liquidated 550K CVX as long-running DeFi probe widens
Azeem Ahmed, founder of Mochi Finance and GaiaDAO, sold roughly 550,285 Convex Finance (CVX) tokens on March 19, converting a Curve-linked token position into nearly $946,000 in on‑chain proceeds and sparking a sharp intraday decline in CVX’s price. On‑chain data reviewed by Crypto Daily shows the tokens were sold at an average price of about $1.72, taking CVX from roughly $1.88 to $1.68 — a drop of more than 10%. The sale routed funds into a multisig tied to the Mochi protocol; that multisig held about $864,858 after the liquidation. Approximately 500,000 CVX remain locked on Convex Finance under the same governance structure.
The sale is the most aggressive on‑chain movement from Mochi‑linked wallets since Mochi’s controversial 2021 Curve incident, and arrives as forensic investigators expand allegations that more than $8 million in staking rewards and millions more in liquidity were diverted — with aggregate investor losses across the Mochi ecosystem estimated at over $54 million.
How the CVX position originated
The CVX stash traces back to Mochi’s November 2021 maneuver on Curve Finance. According to certified chain‑trace reports by forensics firm IFW Global, Mochi minted about 46 million USDM using 10 billion MOCHI tokens that had a hard‑coded oracle price far above their market value. Mochi converted the USDM into roughly 9,876 ETH and used that to buy about 1,050,285 CVX, which were then locked on Convex Finance.
Curve’s Emergency DAO characterized the move as a “clear governance attack,” killed Mochi’s gauge and blocked further emissions as the episode fed into the larger “Curve Wars” battle over CVX/CRV voting power and emissions.
Rewards rerouting and halted distributions
After the 2021 clash, Ahmed resurfaced with GaiaDAO’s Peg Rebalancing Module (PBM), described as a way to funnel CVX staking rewards from the locked position back to USDM holders and restore the stablecoin’s peg. The PBM carried a 2% management fee and a performance fee that Ahmed initially set at 20% — he later raised it to 50% unilaterally, a change he reversed following community pushback.
IFW Global’s analysis indicates that reward distributions from the 1,050,285 vlCVX position ceased by November 2025, and that those rewards appear to have been redirected to a wallet that is also a signer on the CVX multisig. IFW estimates diverted staking rewards alone at more than $1.6 million.
Additional alleged drains and unclaimed airdrops
Investigators further allege that about 2,198 ETH (roughly $6.67 million at the time) and $471,429 in USDC were removed from Mochi/ETH liquidity pools and not returned to depositors. Airdrops from several protocols — including Prisma, CNC, VELO, LFT and YB — reportedly went unclaimed or undistributed. IFW’s certified reports put total investor losses tied to Mochi and related pools at upwards of $54 million.
A pattern of disputes and legal fallout
Ahmed’s involvement in DeFi dates back to at least 2020 and includes projects such as Yieldfarming.insure (SAFE), Armor.fi, Mochi Finance and GaiaDAO. Multiple public disputes have followed. During the original Mochi‑Curve episode, Curve accused Mochi of a governance attack; Ahmed said at the time that the team had taken a “bold approach to gaining voting power” and framed the backlash as incumbents protecting their position. Robert Forster, Ahmed’s former Armor.fi co‑founder, later accused Ahmed of taking “millions in LP tokens”—an allegation Ahmed denied, saying funds were returned and counterclaiming Forster misused money.
Legal pressure has also moved into courts. A San Francisco Superior Court case (Chen v. Ahmed, Case No. CGC‑21‑589609) brought by an Armor.fi user ended in an out‑of‑court settlement after filings referenced in IFW’s report. Lawyers now point to potential U.S. claims including securities fraud (Section 10(b)), racketeering (RICO), common‑law fraud, conversion and unjust enrichment. Affected investors have been encouraged to file complaints with the SEC, CFTC and the FBI’s IC3 portal.
What comes next
To many observers and affected investors, Ahmed’s March 19 sale appears to confirm fears that the locked CVX positions, acquired as part of the 2021 episode, may be used for exit liquidity rather than restitution. With roughly 500,000 CVX still locked and controlled via the same governance structure, additional liquidations could trigger major liquidity events for CVX and renew debate about how protocols should respond when governance power is effectively obtained through exploitative strategies instead of open‑market purchases.
Ahmed, who IFW documentation lists as a UK citizen, has not publicly responded to the latest allegations; his social channels have been largely inactive for months. As investigators continue to trace on‑chain flows and legal counsel weigh potential claims, the Mochi saga remains a flashpoint for discussions around protocol governance, custodial risk and the limits of on‑chain accountability.
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