SushiSwap abandons launchpad and lending protocol as financial struggles surface

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Altcoins
SushiSwap abandons launchpad and lending protocol as financial struggles surface

Ethereum-based DeFi platform Sushiswap has announced the plan to axe their token launchpad and lending protocol from their service offering. The Sushiswap group has been facing severe financial problems over the past few months.

Matthew Lilley, the CTO of SushiSwap, announced a few days ago that the group would be cutting off some of its services, including the lending protocol and launchpad. The CTO tweeted:

While explaining the decision, the CTO noted that Sushi Lending already had several design flaws and was running at a loss. In addition to that, the SushiSwap group needed financial and human resources to dedicate to the now-failed lending protocol. The reason for deprecating the launchpad is similar, i.e., requiring more resources.

However, based on the CTO’s Twitter thread, the network could recreate the two demoted services once they garner enough resources. Still, at the moment, Sushiswap will focus its current resources on its breadwinner, the decentralized exchange network. 

According to Lilley, the DEX industry is already shifting to a concentrated liquidity system. As such, at the moment, the DEX will be prioritizing AMM’s concentrated liquidity to bring them to parity with the decentralized exchange sector. Since their V2 system is already running out of steam, the technology head noted that the plans to complete the creation of the concentrated liquidity are underway. 

Sushiswap ongoing financial struggles

The decision to cut down some of its service offerings could be mainly because of the financial troubles the exchange is currently suffering. Last month, Sushiswap highlighted that they only remained with 1.5 years of operating costs. In their statement, they noted that this situation needs immediate action.

Jared Grey, SushiSwap’s CEO, announced a $30 million loss made by the group in the preceding 12 months. The CEO said the company was already pursuing strategies, including renegotiating infrastructure contracts and cutting back underperforming superfluous dependencies. 

Further statements by Grey noted that they would be freezing budgets for non-critical personnel as they aim to reduce the annual spending to $5 million. Grey even highlighted the problem of Sushi’s emissions-based rewards program and planned to streamline their TVL with LPs. The decision to shut down the launchpad and lending protocol was part of the network’s actions announced last month.

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Adam is outgoing young lad who likes adventures and discovering new things. Despite his boring life, He loves writing about cryptocurrencies and exploring what blockchain technology can do for the coming digital world where all adventures will be virtual.