Read on Twitter
Really interesting dynamic here with @SBF_Alameda going full degen yield farming. Just eyeballing the account it seems like at one point between 20-30% of the entire AUM of Sushi was coming from an account associated with @FTX_Official . Which kind of begs the question…
Where does this risk ultimately sit on this trade? Several people in the @synthetix_io community have reviewed the code but we didn’t audit it and the complexity of the contracts was such that we felt there was reasonable SC risk here.
We have seen several examples of LP rewards contracts that had the potential to be bricked accidentally or intentionally by a deployer. When you send your LP tokens to these contracts you lose control of your funds, the Uni LP wrapper does nothing to protect you!
I personally put less than 1% of my deployable assets in these contracts for this reason. I doubt I could have convinced the sDAO signers to dump 50m in here but I didn’t even try because of, you know sanity, and I say this as a total lunatic.
Which brings me back to the original question, these contracts are not zero risk, you have to be prepared for total loss, so putting tens of millions of dollars in them seems bizarre, unless it is low single digits of your AUM.
I doubt that @SBF_Alameda has 2-3 billion to deploy, which means this has the potential to be a huge blowup event to the tune of maybe even 10% of their AUM and it would be really interesting to know who would be left holding the bag here.
I applaud the iron will this requires to go this big into these unaudited contracts but man, it seems like risking $10m+ for what is likely to be less than $1m in profit is risk adjusted net negative. But YOLO.
I should point out I have zero insight into this just using Nansen to triangulate the likely farmers here. Could be way off base.
