Basis Stablecoin Shutsdown, to Return 90% of Capital to USD/ETH/BTC Investors
Basis was an anticipated stable coin project. However, it shut down after facing too many regulatory problems. It then decided that it would return all capital to its investors. However, some of the investors are feeling slighted by this decision. It is especially so for those who did not invest in USD. Before its decision to shut down, the company had managed to raise $133 in funding.
Those Who Feel Slighted
Those who had made their contribution in Ether were not happy about the Basis refund decision. In the original document signed between investors and Basis, the company had promised to return up to 90% of the funds invested in case the project did not launch.
However, the document did not mention any FX risk associated with BTC and ETH. Investors that invested in USD saw their capital refunded at $1:$1. However, those who invested in Ether saw as much as 85% of their initial investment disappear since they were paid back in their crypto.
Investors Want Parity
Those who invested in ETH had the chance to convert their holdings into USD. However, they decided to hold onto their investments as they were. However, amidst the prolonged bear market, some of these investors are beginning to question why they have to bear the load of the losses in escrow value compared to the USD investors.
Others wonder how the token could have been stable given that 90% of the funds were supposed to go to a stability fund. It is especially so in light on the almost 90% market drawdown. These investors argue that the SAFT agreement calls for pro rata treatment and equal priority for USD and BTC/ETH investors. However, some experts argue that given the current bear market, the refund was done equitably.