Fei Protocol Issue Hits “New Low For DeFi” According To Founder Of Frax

The founder of the stablecoin project Frax, Sam Kazemian, stated his disgust with the way the Fei Protocol’s sunsetting and its hack redemption approach are being handled.

The fundamental problem seemed to be that it doesn’t intend to adequately compensate important protocols, like Frax, who were harmed by the breach.

Fei Protocol, a decentralized stablecoin project, merged with Rari Protocol

In December to form two connected protocols controlled by Tribe DAO. The joint project experienced a $80 million hack in April. According to CoinCu, Tribe DAO has now put out a $157 million redemption plan that would dissolve the DAO itself in the end and compensate victims.

Kazemian has a problem with the redemption packet. On Twitter, he stated that the plan offers little in the way of compensation for the victims of the hack as well as the affected protocols, such as Frax and Olympus. Instead, he asserts, the protocol could repurchase all of the stablecoins, compensate every victim, and still leave Tribe’s governance holders with millions of dollars in value.

“An honorable, ethical, & respectable shutdown of a DAO is literally perfectly here. The money is there. The full repayment, the perfect peg redemption, & moral precedent is possible. I truly don’t understand how it’s possible to look at this, then decide “Na let’s take the rest,” he said.

He added:

“This is truly one of the most mind boggling situations I’ve seen.”

Jack Longarzo, a key contributor to Rari Capital, responded to the redemption package proposal by acknowledging that while the package will reimburse the majority of impacted addresses, “a couple of the larger victims will only be partially reimbursed.”

A stablecoin project called Frax competes with Fei Protocol, which Kazemian has previously openly ridiculed. However, the hack has made the fates of the two projects more intertwined.

Following the incident, Kazemian acknowledged that Frax was one of Fei Protocol’s largest supporters and users and that Frax had been hacked. He claimed in the thread of today that he has since attempted to get in touch with the protocol’s creator, Joey Santoro, but had been unable.

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