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Monday, January 29, 2024

Terra CEO Do Kwon Co-Based Flunked Algorithmic Stablecoin Earlier than UST: Coindesk Report

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  • Do Kwon was supposedly a co-founder of a crashed stablecoin protocol – Foundation money
  • The token leveraged an algorithmic mannequin much like UST
  • Sources declare Foundation Money was constructed by Kwon alongside present and former Terraform Labs staff
  • The information involves mild amid UST’s and LUNA’s present value disaster

Issues have reportedly taken a pointy flip following TerraUSD’s (UST) rise to the highest three stablecoins in crypto. The coin has since depegged from the US Greenback and LUNA is buying and selling under $3 {dollars} as of press time.

Moreover, new data has surfaced linking Terraform Labs CEO Do Kwon to a earlier stablecoin undertaking that didn’t dwell as much as expectations.

In accordance with a CoinDesk report, Do Kwon and some Terraform staff are allegedly the co-founders of Foundation Money, a stablecoin with an algorithmic mechanism much like Terra’s UST token.

CoinDesk backs up the claims by citing conversations and backroom chatlogs between Foundation Money founders, one in every of whom was Do Kwon below the pseudonymous monicker “Rick Sanchez”, a personality from the favored grownup television cartoon present Rick and Morty.

Foundation Money launched in 2020 and was supposedly designed utilizing concepts from one other stablecoin protocol based by Nader Al-Naji. The coin dubbed Foundation/Basecoin in the end crumbled after Al-Naji cited regulatory doubts relating to securities insurance policies.

Notably, the undertaking $133 million from traders earlier than shutting down.

Do Kwon, below the “Rick Sanchez” alias, revived the undertaking someday in August 2020 together with a band of Terraform engineers and staff, per the report. Kwon was supposedly intrigued by the thesis and dubbed the foray as a pilot undertaking.

Foundation Money ultimately attracted traders, boasting an estimated $175 million in whole worth locked (TVL) as of December 2020. Nonetheless, much like UST’s present disaster, the protocol crashed shortly after and is at present far under its promised $1 peg.

Might Do Kwon’s UST Share The Identical Destiny As Foundation Money?

The main points of the invention carry weight contemplating the present state of affairs with UST and LUNA costs. Additionally, the timing of Foundation Money’s launch is pertinent as Terra reportedly launched UST in September 2020, a month after Foundation Money was unveiled by Rick Sanchez (allegedly Do Kwon).

As of the time of scripting this report, UST is under the $1 mark and is down 24% per knowledge from CoinMarketCap.

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