SushiSwap Members Rejoice as Whale Bails from Token - The Defiant

After Shaping Sushi’s Reform Plan Arca Hits the Exits

Arca, a crypto-focused asset manager, appears to have sold its $3.1M position in SushiSwap’s token. And many of the crypto exchange’s community members couldn’t be happier.

On Aug. 30, a transaction from a wallet associated with Arca was flagged in the SushiSwap community Discord for withdrawing more than 3.1M SUSHI from staking and transferring the tokens to FTX, a centralized cryptocurrency exchange.

A sudden influx of volume was spotted on FTX shortly after, with the price of SUSHI abruptly sliding from $1.10 to $1.07 over the course of a single three-minute candle. The asset has since traded between $1.02 and $1.07 in the past 24 hours

Whale With Influence

On July 17, 2021, Arca’s chief investment officer, Jeff Dorman, tweeted that the firm was “one of the largest xSUSHI holders” and controlled 7.5% of its circulating supply.

SUSHI’s price plunged on FTX on Aug. 30. Source: TradingView

As a whale that’s exerted influence on SushiSwap’s direction, Arca has long been the target of members’ ire.

“Sushi is not community-run DAO anymore… Now it’s controlled by Arca+Cumberland plus a few others who make all the shots with the comp committee,” tweeted Pegbit, a core Sushi team member, in July.

Another community member, Mountain_goat, welcomed the apparent trade yesterday. “Thank you Arca for absolutely nothing,” Mountain_goat said on Discord. “You came, you saw, you made a mess… Best news in a long time. Here’s to being a community again.”

Other community members were equally relieved at Arca’s apparent exit from its SUSHI position.

“If they already sold that’s great news,” ChronoFury said on Discord, adding that the wallet has long been suspected of belonging to Arca, “I’m guessing that high volume red candle on FTX was them.”

Margin Call

Arca did not respond to a request for comment from The Defiant.

The crucible unfolding at SushiSwap has pulled back the curtain on how DAO-led projects are laboring to balance a vote-reliant management model with a growing business.

SushiSwap is the fifth-largest DEX with a total value locked of $945M, according to DeFi Llama. Its SUSHI token has a market cap of $206M, but its price has tanked 89% since the start of the year, compared to a 63.6% drawdown from its top competitor, Uniswap, over the same period, according to CoinGecko.

RSK, a member of Samurai, SushiSwap’s community engagement team, asserted that the wallet does belong to Arca, and that all of the tokens it used to contain have been moved, not just SUSHI. “Not sure what happened but they have emptied that wallet which also had other tokens,” RSK said in the governance forum. “They brought SUSHI around 10$ avg, got burned badly on LUNA crash too.”