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The $13 Million SushiSwap saga

07 Sep 2020 : 08:00
3 min read
  • Chef Nomi had a $13 Million exit in only a few weeks
  • Price unraveled by 60% in a day
  • Sam Bankman-Fried was chosen to take over, reviving hope in the SushiSwap project once again

DeFi Craze & Food Theme

It is no longer a secret that this run up seen in crypto is mainly driven by decentralised finance. As things progressed and more money begun flowing into this sector, weird trends started to emerge. One of those trends is food-inspired coins such as Yam, Pizza and Sushi.

Sushi: Not just a meme

Despite the belief that most of these tokens and projects are vaporware, SushiSwap was able to achieve something significant: locking in over $1,000,000,000 in value in a matter of weeks (70%+ of Uniswap).

The project is a fork of the most liquid and popular decentralised exchange: Uniswap. Unlike Uniswap its liquidity originally came from the community and all liquidity providers were rewarded with the SUSHI token. That token sky-rocketed in price and became worth north of $10 at its peak.

Chef Nomi

The creator of this project was an anonymous figure going under the name of “Chef Nomi”. On September 5th, he sold his stack in exchange for ETH. At the time of the transaction, his SUSHI were worth $13 million. This happened simultaneously as prices were taking a hit which added more selling pressure to SUSHI and sent it down -60% in a day. This effect also seemed to have propagated into ETH which took a harder hit than other large caps.

Exit Scam?

Chef Nomi was accused of exit scamming even though he “explained” that him selling is so he can focus purely on the development and deployment of the project. This is similar to what Charlie Lee, creator of Litecoin, said when he sold his LTC at the height of the 2017 bubble. This was in fact referred to by Nomi.

But nonetheless, his actions had a negative effect on the price and it also shook people’s trust out of place.

Sam Bankman-Fried

Sam Bankman-Fried (SBF) is the CEO of both FTX and Alameda Research. The latter owned a large portion of the SUSHI supply which they earned by providing liquidity. After the actions taken by Nomi which caused him to lose the public’s trust, SBF was chosen to take over. SBF, after the receiving the SUSHI key, is transferring the control to a multisig to be chosen by the community. This positive turn of events had a positive price impact on SUSHI’s price and sent it upwards of 100% in three hours.

About Author

Karim Abuzeineh

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Co-Founder of Cryptonary Karim has entered the crypto industry in 2017, went through the ups and downs of the market and dedicated himself to increase his skillset and knowledge in both Fundamental & Technical analysis through the bear cycle. He is bullish.

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