Did the founder hide a failed project?

Terra-Founder Do Kwon allegedly, the stablecoin is based on the failed stablecoin Cash. Basis Cash is an algorithmic stablecoin that is pegged to the US dollar, but has not been able to achieve stability against the dollar.

Is Terra founder Do Kwon behind Basis Cash?

A former Terra Labs employee has reportedly revealed that Terra co-founder Do Kwon is one of the creators of Basis Cash. The Algorithmic Stablecoin failed last year, as a report by Coindesk shows.

Citing a former engineer at Terraform Labs, Hyungsuk Kang, the report says: In fact, Basis Cash is the early work of Terra creators – including Kwon.

The revelation comes amid the crash of UST, which lost its peg to the dollar a few days ago. This is where history repeats itself, because the same thing happened with Basis Cash.

According to the report, a group of anonymous developers launched Base Cash on Ethereum in 2020 as an algorithmic stablecoin pegged to the US dollar.

However, he could not achieve this stability against the dollar and fell under the binding at the beginning of 2021. Currently (at the time of this article) the stablecoin is trading below one cent.

According to reports, Kang said:

“Basis Cash was not tested at that time, and we weren’t even sure. (Kwon) just wanted to test it. He said this is a pilot project to do that (UST).“

“Rick and Morty” as a pseudonym

Another person who was involved in the development of Basis Cash and wants to remain anonymous confirms Kang’s statement. Both add that Kwon is actually “Rick Sanchez”, the pseudonymous co-founder of Basis Cash. The two founders of Basis Cash had taken the names Rick and Morty as pseudonyms for the project.

Coindesk confirms this by reviewing Basis Cash’s internal chat logs. In which Kwon refers to himself as Rick.

However, Basis Cash was not successful. Its market capitalization reached only $ 174 million, far below that of UST. At its peak, it became the third largest stablecoin by market capitalization.

According to Coindesk, due to the public interest, it was decided to expose the founder. So far, the crash of UST and Luna has had a massive impact on the broader crypto markets. The value of other digital assets has therefore fallen to new lows.

However, Do Kwon continues to call for calm and explains, that his team has a long-term plan to move things back to the positive.

Text Credit: Cryptoslate

Last updated on May 12, 2022

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