SushiSwap Founder Settles His Tokens For $ 6 Million In ETH

Key facts:
  • NomiChef, anonymous developer of SushiSwap, liquidated its tokens for more than $ 6.3 million.

  • SUSHI loses 55% of its value and questions whether the project will continue on its way.

The founder of SushiSwap, DeFi liquidity platform, sold all of its SUSHI tokens for 17,971 ETH, currently valued at 6.3 million dollars, approximately.

The information was released a few hours ago in his twitter account the anonymous founder of this platform, generating a stir that points out what happened as an exit scam.

SushiSwap is a fork of Uniswap, where you can trade ERC-20 tokens and cultivate returns (yield farming) in the middle of this DeFi ecosystem. However, SushiSwap distinguishes itself in that grants fixed returns with the SUSHI token for simply participating in the platform; unlike Uniswap, which awards rewards according to the amount of funds (liquidity provided) used in this market.

This week Cinneamhain Ventures shareholder, Adam Cochran, who was a SushiSwap investor, said he was withdrawing from the project upon detecting the risk of a vampire attack. This type of attack, according to analysts explained this week, would allow the transfer of other tokens anchored to SUSHI in Uniswap to the SushiSwap platform, leading to the bankruptcy of Uniswap.

The fact that there was no governance contract that prevented SUSHI tokens belonging to their developers from being properly burned or withdrawn under consensus, prompted Cochran to withdraw from this project. Today the danger of a developer fleeing or departing from the project by liquidating huge amounts of the token has become a reality.

The developer known under the name of NomiChef (represented by a sushi chef panda bear), announced to his followers on the social network Twitter that he had converted all his sushi tokens into Ethereum.

sushi token developer price drop

NomiChef is a developer who hides his identity behind the character of a sushi expert panda bear. Source: @ NomiChef / Twitter

Although he assured that he would remain close to the project, contributing in the technical aspect, his decision caused the price of SUSHI to devalue from 5.53 to 2.32 dollars during the first hours of the morning today, devaluing 54% according to a sample Uniswap.

In the comment thread, NomiChef assures that what he has done is not very different from what Charlie Lee, founder of Litecoin, did in 2017 when he sold his positions in LTC, sowing doubts about the credibility of this cryptocurrency (one of the first created after Bitcoin).

However, some netizens point out that unlike NomiChef, Lee worked for years developing a cryptocurrency that, in relative terms, has credibility, track record, purpose, and decentralization.

Regardless of perceptions regarding Litecoin, it should be noted that SushiSwap was launched just a week ago, amid a fever for new tokens that take their names from dishes or types of food, like sushi, hot dogs or pizza.

What happened today seems to be a perfect example of economics ponzinomics in the DeFi. A project takes an attractive brand design in terms of marketing; issues its token and does not stop promoting it to inflate its value to disproportionate levels. But when there is no liquidity, or we move one of the pieces at the top of the pyramid, the price falls to the floor faster than it rose.

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