Wintermute CEO Evgeny Gaevoy said he may pursue legal action over Near Foundation and Aurora Labs’ failure to fulfil promises to convert stablecoins USN worth $11.2 million into USDT from Tether.
Public service announcement or “how we are not really friends with Near @NEARFoundation and Aurora Labs @auroraisnear going forward”?
— wishful cynic (@EvgenyGaevoy) November 7, 2023
According to Gaevoy, bankrupt exchange FTX asked the market maker for assistance in selling the Near ecosystem’s “stablecoin.”
The firm carried out its part of the deal, “providing creditors of FTX more than $11 million” in the belief that it would swap “USN for USDT at a 1-to-1 ratio,” the head of Wintermute explained.
The company executed the transaction on the basis of public and private assurances from Near Foundation and Aurora that they would settle the obligation in a couple of days.
“After 2.5 months we have received nothing for the USN sent to them in August. The final offer they made us was 20% of the discussed amount,” Gaevoy noted.
The counterparties’ failure to meet their stated obligations inflicted direct damage on Wintermute, he emphasized.
“We are using all lawful means against Near Foundation and Aurora. We have the funds and the capability to do so,” said the head of the market maker.
According to reporter Colin Wu, Near Foundation CEO Illia Polosukhin replied that Wintermute acquired 1.2 million USN from Alameda Research and asked to exchange them for USDT. The request was declined, because the assets “have a suspicious origin and may be related to illicit activity.”
NEAR Foundation CEO Illia Polosukhin said that Wintermute acquired 11.2 million USN from Alameda estate and requested to exchange them for USDT. These USN is of suspicious origin and may be related to illegal activities, and Wintermute is trying to arbitrage. Therefore its…
— Wu Blockchain (@WuBlockchain) November 8, 2023
USN was launched in April 2022. The stablecoin’s operator was the decentralized autonomous organization Decentral Bank.
Initially, the coin’s price was supported by arbitrage operations and a reserve fund of NEAR and USDT tokens. The launch of USN coincided with unfavourable market conditions, notably the collapse of the Terra ecosystem.
Back in October 2022, Near Foundation ceased support for the stablecoin amid multiple risks, including insufficient collateral. The asset was to be swapped for USDT over the following 12 months.