Controversial DeFi project SushiSwap, which has been accused of pulling an exit scam when Sushiswap announced that its community had approved a migration to its own platform from Uniswap – the very platform it was forked from to be created.
The migration of Sushiswap from the Uniswap automated market maker platform would see around $180mln worth of liquidity move from the latter platform, according to reports from Cointelegraph last week. The ETH/SUSHI trading pair accounted for that $180mln valuation.
For those who lost money in this irregular move, there has been a suggestion from prominent cryptocurrency lawyer Preston Byrne who has urged people to “Lawyer Up”
Concerns of SushiSwap and Chef Nomi
SushiSwap has grown in popularity in quick time as it is like a yield farming version of decentralized exchange Uniswap. However, last weekend, amid the token falling from an all-time high of $11 to $2.38, SushiSwap’s pseudonymous creator Chief Nomi cashed out, withdrawing $12 million from $SUSHI’s liquidity pool.
The community accused him of pulling an exit scam, which he denied. This has not stopped Byrne from indicating that there is a chance of getting money back from the project.
“In the case of SushiSwap, there are clearly steep losses across the market, and likely one source available for recovery, chiefly, “Chef Nomi,” he told Decrypt. “There is only one legitimate way to access those funds, and that is by winning a lawsuit.”
He added that the law doesn’t discriminate against any type of cryptocurrency, be it a meme-coin or not.
“US investor protection laws don’t protect only unsophisticated investors or investors who don’t invest in meme tokens. They protect all investors and particularly investors with clean hands,” he said.
Regulators are watching
The real concern is that these strange happenings with huge sums of money will be coming up on regulators radars and they will be none too pleased. It was the regulators who came down hard on ICOs when they ran riot and left many people out of pocket in dodgy business practices.
This new space has similarities to those issues with ICOs in that it is a new and totally unregulated space that needs to be self regulated to start with but these occurrences are not what is needed.