An uncertain future – Day after day, the collateral victims of the collapse of FTX multiply. Indeed, the exchange platform had massively invested in the ecosystem, leaving many projects without funding. This is particularly the case of Ren protocol, which plans to issue new tokens to finance itself.
Ren Protocol and FTX
The protocol ren allow to do transfer assets between different blockchains. Its most popular product, the renBTC, allows you to transfer BTC to the Ethereum network. In particular, this allows BTC holders to take advantage of DeFi returns.
To do this, the protocol will use a series of smart contracts. The BTCs to be migrated are blocked on the side of the Bitcoin blockchain, before being issued in the form of renBTC on Ethereum.
At the beginning of 2021, the Ren protocol was acquired by the Alameda Research investment fund. As a reminder, Alameda Research is none other than FTX’s sister investment fund.
Unfortunately, all protocol treasuries were stored on FTX. Consequently, following the fall of the exchange platform, the Ren protocol finds itself without funding.
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Ren tries to raise the bar
At the beginning of December, the protocol Ren announced his desire to accelerate the deployment of his version 2. This allows in particular to get rid of the influence of Alameda Research and allows a better decentralization of the project.
In addition, the latter announced an incompatibility between the two versions of the protocol. Therefore, all holders of renBTC and other tokenized assets were bound to become unusable. Thus, users were invited to convert their assets back to the original assets.
No exact date has yet been announced, but the official Twitter account said the migration would be “imminent”. At the moment, there are just over 800 renBTC left in circulation, the equivalent of over $12 million..
A REN issue to bail out the coffers
However, the switch to Ren 2.0 does not solve the cash flow problem encountered by the protocol. Consequently, he had to find a solution to replenish his coffers.
Thereby, Maximillian Roszko filed a change proposal on the protocol governance forum. On the one hand, it offers the creation of the Ren Foundationa structure whose mission will be to support the development of the protocol.
On the other hand, this proposition suggests issuance of new REN tokens, the native token to the protocol, to replenish the coffers of the treasury. For this, Roszko offers four possibilities in addition to the possibility of rejecting the proposal. These possibilities relate to the amount of tokens that will be created, namely 50, 100, 150 or 200 million tokens.
A portion of these tokens will be allocated to darknodes, central players in Ren’s ecosystem. The rest will be allocated to the Ren Foundation. At the current price, this represents a monetary creation of the order of 3 to 13 million dollars.
This does not turn out to be great news for REN holders, as it would increase the circulating supply by a maximum of 25%.
On his side, Sam Bankman-Fried, the former CEO of FTX, decided to be extradited to the United States. He will be tried there on eight different counts.
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