Ethereum: SushiSwap, the DeFi protocol that panics counters and minds

The controversy over SushiSwap is open – Presented by its anonymous creators as an „evolution“ of Uniswap, the DeFi SushiSwap protocol has attracted 1.2 billion dollars in funds in a few days. To seduce, it can count on its governance token , SUSHI, which is very popular.

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Will SushiSwap meet a fate comparable to that of YAM , another DeFi token ? Within a day, the token reached $ 750 million in cryptocurrency in escrow. Two days later, a bug caused the beautiful mechanism to fail.

SushiSwap has had a similar start. In less than a week, SushiSwap has accumulated over $ 800 million in chips. This represented 80% of Uniswap’s total assets , again in strong momentum .

Differentiation based on the SUSHI token

This rapid growth would have a priori cause for concern within the crypto community. But the model is nonetheless attractive. On September 2, Sushiboard announced that total committed funds have now reached $ 1.2 billion .

The value of the SUSHI governance token of the project, meanwhile, passed $ 7. However, it is this token that mainly distinguishes SushiSwap from Uniswap. The DEX People’s DeFi no offers in to date.

To reward liquidity providers, Uniswap pays part of the trading fees received (0.3%). SushiSwap opted for a slightly different model. The project offers them 0.25%, but also 0.05% converted into SUSHI tokens .

However, the value of this governance token continues to increase. At the start of the week, it was $ 3.62. Its quotation has since exceeded $ 7 . But with its interface inspired by YAM, its anonymous founders, unaudited smart contracts and a model based on the fork of liquidity, SushiSwap necessarily divides and questions.

SushiSwap or the premium for risk lovers

However, its creators have already provided answers to some of these concerns. First of all, an audit of contracts is on the agenda. It was entrusted to Quantstamp. Protections have been implemented to prevent administrators from leaving with the fund. Finally, SushiSwap offers even better rewards for risk taking.

By providing liquidity to the most volatile pools, users will get better compensation. The new governance proposal brings it to x5, or 5,000 SUSHI per block for the first two weeks (compared to x2 previously).

This does not however prevent SushiSwap from counting many detractors among DeFi experts. Decrypt even sees a schism emerging between the proponents of anonymity on the one hand, or „Anons“, and the „elites“ funded by venture capital.

Brendan Forster, co-founder of the Dharma Labs loan protocol, is undoubtedly among the critics of SushiSwap , which he openly wishes to fail . According to him, such a fork on liquidity will seriously weigh on swap prices and on losses for liquidity providers.

The only beneficiaries are the founders of Sushi, Forster denounces. The continued growth of funds under the DeFi protocol, however, suggests that its view is not unanimous among the community.

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