At the moment, the DeFi market is one of the most amazing markets. There are many DeFi stars in the market. One such project is SushiSwap. The project encourages investors to withdraw liquidity from Uniswap with a token and deposit it on Sushiswap.
The whole thing seemed to be going well and the project was really picking up speed. For instance, the token quickly increased to a maximum of over $11 but now there has been an incident that has made its mark on the price in the last 24 hours. More than 60% of SUSHI is in the dump in the last 24 hours. What happened? Let’s take a look at it in more detail.
The reason behind this is: The anonymous creator of Sushiswap the “Chef Nomi” on Twitter has tweeted that he has sold all of his SUSHI. Chef Nomi swapped all his SUSHI for ETH, insisting it was not an exit scam.
The above tweet is displaying that he had a ETH / SUSHI liquidity pool. It seems that in one transaction, he withdrew almost 2.5 million SUSHI (around 20,000 ETH) from the pool and exchanged the SUSHI for ETH. After this, a further 18,000 ETH. At the time of this writing, his address had 38,000 ETH (equivalent of around $12 million).
In a series of tweets, the anonymous founder Chef Nomi insisted that he has simply converted the SUSHI tokens to roll the project away from uncertainties on its migration from Uniswap to SushiSwap. The SushiSwap founder maintains it was not an exit scam. Rather, he associated himself to Litecoin founder Charlie Lee, who traded off all his LTC holdings in the year 2017.
Chef Nomi further said that he would continue to be available for the community as a developer and will ensure that the token migration from Uniswap to Sushiswap goes smoothly.
I did the recent move because I care about the community. I'm taking IL for you. But all I received was blaming and FUDing.— Chef Nomi #SushiSwap (@NomiChef) September 5, 2020
Here's what happened. The devshare part of me. I converted them to $ETH. I stop caring about price and I will focus on the technicality of the migration.
The cryptocurrency community is not happy
Many in the crypto community were upset about the incident, which is expected, given the damages that occurred from the direct sale of the 2.5 million SUSHI and the confusion and panic it created about the incident.
The official Sushiswap Twitter account posted about an impending liquidity migration in less than 48 hours but this also raises some questions. Actually, the migration phase from Uniswap to Sushiswap should only start at block 10,850,000 and seems this was not the case.
Since many in #SushiSwap community have asked, this is indeed, true. There's no denying that we've sold the existing dev shares and put future $SUSHI dev shares into MultiSig community owns.— 🍣 SushiSwap | sushiswap.eth (@SushiSwap) September 5, 2020
Now we go back to making sure that the Liquidity Migration happens smoothly in <48hr ✅ https://t.co/nSeliVJFSu
It will be too early to say anything about this incident at the moment. The next few days are crucial and will tell us whether it is actually an exit scam or something else. In any case, there is a new, freshly minted multimillionaire in the crypto world, and that because of a project that has not even existed for 2 weeks. The cryptocurrency world is indeed full of good and bad surprises!