The latest DeFi protocol star, Sushiwap, has grown at a fast pace since it launched. Everything seemed great until the project founder, Chef Nomi, swapped his SUSHI holdings for ETH.
An Exit Scam?
On Sept. 5th, Chef Nomi withdrew 2.5 million SUSHI from the liquidity pool and exchanged for 18,000 ETH, which worth about $6 million. He also removed 20,000 ETH from the same liquidity pool in the protocol, worth another $7 million.
(Source: Etherscan)
SUSHI Price Drop and Community’s Anger
This move led to a sharp drop of SUSHI token price: the price went all the way down on Sept. 5th, from over $5 to less than $2. Its on-chain volume showed the same trend.
(Price indicator: https://www.dapp.com/app/sushiswap)
The rest of the crypto market also dropped to some extent during last weekend.
The crypto community got upset about this issue. Users questioned the “head chef” if this whole project was an exit scam. However, replying to this with several tweets, Chef Nomi insisted that he simply swapped the SUSHI tokens in the benefit of the project’s coming migration from Uniswap to SushiSwap.
“People asked if I exited scam. I did not. I am still here. I will continue to participate in the discussion. I will help with the technical part. I will help ensure we have a successful migration,” he wrote on his Twitter.
But many in the community still didn’t buy his words. They demanded him to give out his admin’s key.
New “Master Chef”
On Sept. 6th, Chef Nomi handed over his control of Sushiswap to the CEO of crypto exchange FTX, Sam Bankman-Fried.
The SUSHI Price then went back after the announcement from $1.24 to around $3.
Will this new “master chef” rescue SushiSwap and make satisfied “SUSHI” for the community?
It would be too early to say where Sushiswap is heading at the moment as the DeFi sector is updating itself every second. We’ve seen what happened to Yam1.0 in 2 days. And now, YamV2 governance is live. Then when the market fluctuates, it’s important to keep skeptical and don’t invest more than you are willing to lose.
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