The Decentralized Finance [DeFi] space has gained a lot of attention in 2020 and given the hype, it has invited a lot of skeptics as well. Alas, the hype of DeFi seemed to come crashing down on 5 September after the anonymous founder of SushiSwap sold all of his tokens, with many yelling “Exit scam!”
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However, what people say may not always give the entire picture. In fact, if one had paid some attention, one would know that the Master Chef had already announced his retirement on 4 September via a tweet. He had stated,
“With all the growth of @SushiSwap (and the FUD), I’m considering transitioning the admin control of MasterChef and devshare address to a MultiSig address behind timelock. “
The founder, dubbed @NomiChef on Twitter, noted that the contract was already deployed and all that was needed were the ‘signers.’ The founder stated that ideally, the control should have passed to GovernanceAlpha smart contract for on-chain voting, however, given the exuberant gas cost, MultiSig was the route to take.
The Chef had opened this offer up for 24-hours and provided the list of names nominated for the signer’s position, telling them what to do next. Despite offering all the updates to the SushiSwap community, alas, there was a lot of FUD around the migration. In fact, @NomiChef provided a stepwise breakdown of how the process out to be carried out.
I’ve converted all the $SUSHI tokens in the devpool to LP tokens for SUSHI-ETH Uniswap LP. All the LP converted will go through the migration alongside everyone who put their LP tokens in MasterChef contract.
— Chef Nomi #SushiSwap (@NomiChef) September 5, 2020
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The Chef finally asked community members who believed in the project to “stay through the migration and become part of @SushiSwap in the long run.”
However, as the Chef sold all his Sushis, the market got alarmed and everyone started calling it a scam. @spencernoon on Twitter attached a screenshot of the transaction and simply said, “Called it.”
The paradox of #DeFi: trust-minimized protocols require trust-maximized communities.
Prediction: history will not look kindly on “anonymous” fast forks that were predicated on deception and lies.
— Spencer Noon (@spencernoon) September 5, 2020
As a justification, the Chef tried to highlight the example of Charlie Lee, the founder of Litecoin, who in 2017 had also “sold and donated” all of his Litecoin in 2017. However, a part of the community didn’t take the comparison seriously. A Twitter user, @bitdov, stated,
“@satoshilite was there from 2011 till 2017… Doing a Proof of work coin. Your claim that this is in any way similar to what he did is ridonculous. Not that his exit was smooth or something, but at least it was after over 6 years of PoW”
With the community divided, the anonymous Chef continued to state that this was done because they “care about the community.” @NaomiChef concluded,
“All I can say is if this experimentation goes on to success, you guys know the upside. But if people don’t believe in the project, it will fail and we return everything back to the original creator @UniswapProtocol. I am happy with either result.”