Are the Ethena Critical flaws for real?

One needs to take a cautious approach and do due diligence before assigning your funds to any project. With this standard disclaimer let us explore the nuggets of information that come to us from Tardfiwhale.

Who is Tardfiwhale?

The best we know Tardfiwhale is a pseudonym who could be one person or a group of persons. Tardfiwhale is credited for correctly predicting the fall of Luna and UST.
This time round the anonymous detective of the blockchain has rung the alarm bells for the Ethena project.

What is Ethena?

Ethena is a blockchain project that is working on a synthetic dollar stablecoin protocol.

What does Tardfiwhale say about Ethena?

Going by the handle TardFiWhale on twitter (X.com)
The message from the account states...

Time for a 🧵on the coming downfall of USDe and @Ethena_labs

Bad news: If USDe keeps growing, people will lose a lot of money given how the protocol currently operates.

Good news: There are solutions to fix it.

This is a tweet dated March 16th 2024 that has already received 112.2K views.

source: https://twitter.com/TardFiWhale/status/1768748006923252062?s=20

Stakes could be high for Ethena and those who have put their crypto into the project

Ethena has quickly gained popularity and already issued $1.5 Billion worth of USDE which is its synthetic dollar stablecoin.
As per Tardfiwhale there is a critical flaw

As per the alerts issued by Tardfiwhale the flaw can make the users of the protocol "lose a lot of money" based on the Ethena protocol current state of operation.

Looking at the timeline of the users account there are references and evidence that the same account had forewarned about the failure of LUNA and UST and also raised an alarm about the possibility of a possible Bank run involving the OHM platform.

The alert is a teaser

While the account raises an alert it stops short of divulging the details.

Is there a price tag for the reveal?

The account claims that the actual source of the flaw would be revealed when a fee would be paid.
Initially the fee to be paid was $500,000 and needed to be paid in donations.
Half of this is to be paid to Protocol Guild which is a group of Ethereum developers.

The other half is to be equally divided into two parts one part going to Zachxbt a crypto researcher and the other half going to the legal defence of the Tornado Cash developers. Who are facing money laundering charges.

However on the 18th of March the bounty got increased to $1 million with the amount to be paid in the same proportion to be paid to the above mentioned parties.

He also states that he would not benefit personally from these revelations and is only trying to give back post the events of UST, FTX and Celsius and it would be bad to see USDE going that route.

This is a chance for me to give back, and after all the pain caused from UST, FTX, Celsius, etc., it would be sad to see another disaster with USDE.

Final thoughts

Tread with caution. Crypto offers a lot of opportunities and new projects keep coming all the time. Yet one needs to be cautious and do research about the projects and try to study the smart contract codes and check if the audits have been done by accredited agencies.

The first step would be to query the project team about the news as most projects are responsive to queries from their community.
Secondly do check if the code audits have been done for the project

image source

Posted Using InLeo Alpha