The ongoing hype about the abnormally high returns from Defi tokens has naturally seen many more investors moving funds to decentralized protocols. As of October 10, total value locked in Defi protocols was nearly $11 billion. However, despite this apparent endorsement of Defi, rug pulling incidents and outright scams now seem to be blighting this space.
News.bitcoin.com has been reporting on the growing popularity of Defi protocols as well as exposing the fact that some devs and founders wilfully engage in practices that harm interests of the burgeoning Defi community.
SBF’s Actions Were Not Approved by the Community
Just recently, Sam Bankman Fried (SBF), the individual that took over the reins at SushiSwap in early September, was accused of acting immorally. The allegations stem from SBF’s use of FTT (a centralized token) as collateral for short selling other assets. It has emerged that SBF’s actions were not approved by the community and reports suggest the matter will be resolved via a vote which ends October 14.
However, before the vote is even closed, critics are making the argument that if “economically rational market participants such as SBF are able to take advantage these tools in a way that the community doesn’t approve of, the immaturity of both the market and its users are revealed.”
Meanwhile, SBF, who is defending his actions, is not the only influencer getting panned for using a privileged position to enrich himself. Blue Kirby, the YFI fanboy, is another prominent individual that has been criticized first for actively promoting Andre Cronje’s botched EMN before it got hacked. Secondly, Kirby faces accusations of dumping his YFI when the Defi token suffered losses in the past few weeks.
12 Defi Con Artists Exposed
The complaints against SBF and Blue Kirby are just two of the many cases where influential individuals are caught acting contrary to the values they publicly espouse. In many cases, however, Defi con artists are only exposed…