Do Kwon, founder of the Terra blockchain and the company behind its protocol, Terraform Labs, was allegedly the brains trust of another failed stablecoin project, Basis Cash (BAC).
According to a recent report from US-based crypto journalists Danny Nelson and Sam Kessler, Basis Cash was an Ethereum-based stablecoin meant to be pegged to the US dollar through code and not any actual collateral. The project was abandoned by its creators in early 2021 after it failed to reach parity with the dollar, in fact sinking below US$1:
As Crypto News Australia reported this week, TerraUSD (UST) lost more than 50 percent of its value in a single day after the stablecoin started de-pegging due to a series of significant withdrawals on the Anchor Protocol, a DeFi lending protocol that offers high yields in UST.
Kwon Outed as BAC Co-Founder ‘Rick Sanchez’
Now, new controversy surrounds Kwon as he was one of the two pseudonymous co-founders of BAC, going by the moniker “Rick Sanchez”.
Looking at DefiLlama stats, we can see Basis Cash had a TLV (total locked value) peak of roughly US$175 million shortly before dropping to almost zero in December 2020. BAC’s current market price is 0.007.
Too Little, Too Late for UST
At the time of writing, UST had lost nearly 40 percent of its value in the past week, as per data from CoinMarketCap. The Luna Foundation Guard (LFG), stewards of Terra’s UST, is looking to inject US$1 billion to save UST. However, the crypto community remains reticent and thinks it may already be too late for a bailout:
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