Terraform Labs CEO Do Kwon was one of the anonymous co-founders of the failed algorithmic stablecoin Basis Cash (BAC). It is reported by CoinDesk, citing sources.
Launched in the second half of 2020, the coin relied on the arbitrage of the native BAS token to maintain a stable price of $1. A similar mechanism is used for the flagship stablecoin of the Terra ecosystem – UST.
In January 2021, the price of BAC fell below the $1 level, which it never broke again. At the time of writing, the coin is valued at $0.006 (CoinGecko).
At its peak, the market capitalization of BAC was $93 million. In May 2022, UST lost its peg to the dollar, at the moment the price fell below $0.3. The volume of stablecoin supply on the eve of the fall exceeded $18.6 billion.
Former Terraform engineer Hensok Kang [Hyungsuk Kang] told the publication that Basis Cash was a spin-off from the creators of Terra, including Kwon.
“Basis Cash was not tested at that time, we were not even sure that it would work,” the developer noted.
According to him, Kwon called the project a pilot project.
Kang and another anonymous ex-employee told CoinDesk that Kwon was hiding behind the pseudonym Rick Sanchez. The nickname of the second co-founder was Morty.
The publication revealed that Terraform’s Basis Cash developers modeled it after an earlier product called Basis. In 2018, the founder of this stablecoin, Nader Al-Naji, announced the closure of the project due to pressure SEC and the return to investors of attracted financing in the amount of $133 million.
Recall that on May 11, Kwon presented a plan to restore the price of UST, against this background, the quotes of the LUNA token collapsed below $1.
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