Near Fundation in Conflict With Wintermute Over $11 Million

Recently, a conflict arose between Wintermute, a company engaged in cryptocurrency operations, and the Near Foundation, in collaboration with Aurora Labs. The source of the dispute is an agreement involving the conversion of stablecoins worth $11 million, specifically USN.

Decentral Bank created USN, an algorithmic stablecoin in April 2022. What sets this coin apart is that it presents itself as an independently controlled company, without receiving direct financial support from the Near Foundation.

0. Intro

Keeping things quiet is often a sensible approach to adversarial situations. If you have been following the SBF trial, that’s exactly what Alameda/FTX did when they got “hacked” by people using “very profitable trading strategies” in $MOB and other tokens. However,…

— wishful cynic (@EvgenyGaevoy) November 7, 2023

This independence has added an interesting nuance to the dispute, as Wintermute alleges that the Near Foundation has not fulfilled its commitments regarding the redemption of USN.

Wintermute’s CEO, Evgeny Gaevoy, has expressed his disappointment and frustration over what he considers a breach of both public and private agreements.

The initial agreement specified that they would convert USN to Tether at a one-to-one exchange rate, an agreement that Wintermute claims Near and Aurora Labs did not fully honor.

Furthermore, Gaevoy stated that they received a final offer that represented only 20% of the original agreement.

Near Risks Going to Court with Wintermute

This situation has strained the relationship between the involved parties, as Gaevoy openly stated that their relationship with the Near Foundation and Aurora Labs deteriorated significantly.

Evgeny hinted at the possibility of pursuing legal action against both parties because they did not uphold the agreement.

Amid the controversy, it’s worth noting that the Near Foundation had previously announced its interest in investing in USN. As a result, they decided to establish a $40 million support fund to facilitate the conversion of USN to USDT.

They made this decision because USN was in an under-collateralized state. USN launched in April of the previous year and has since attracted attention and sparked debates within the cryptocurrency community.

Gaevoy’s public message is clear: he expects the Near Foundation to complete the redemption according to the agreed-upon terms.

However, he warns that if Near fails to fulfill its obligations, Wintermute is prepared to take a more adversarial approach.