Kujira to Form DAO Following Exploits and Market Instability

Kujira, a decentralized finance (DeFi) platform, encountered substantial hurdles when the team spent operating cash to boost liquidity and activity in the ecosystem.

Due to “exploits, socially engineered attacks, and fallouts within the ecosystem,” this endeavour was met with market volatility and quick sell-offs.

The Kujira team announced a proposal in an official X (formerly Twitter) post that could shape the platform’s future. They plan to create the Kujira Operational DAO, a decentralized autonomous organization (DAO) with the potential to revolutionize the platform’s operations.

GM all. We’d like to address the current events.

As a team we thought the best use of a portion of ops funds would be to leverage and deploy across the ecosystem in order to bootstrap liquidity and activity. We genuinely felt like this was the correct course of action at the… pic.twitter.com/qBw9w6y94b

— Kujira 🉐 (@TeamKujira) August 1, 2024

Impact on the price

Kurjia’s native token, KUJI, is falling sharply due to the foundation’s liquidation of its leveraged liquidity position. According to Coinmarketcap, Kujira’s KUJI coin is down 52.16% daily, while the chain’s total value locked (TVL) has decreased 22% to $38 million during the last 48 hours.

The foundation blames the liquidations on bad timing, stating that the pace of sales rendered defending their positions “impossible” and that their leveraged deployments coincided with “exploits, socially engineered attacks and fallouts within the ecosystem.”

The team clarified that although they had “worked hard” to maintain employment safety, the sales volume rendered this unfeasible.

“Although this was by design by a select few, we of course, take full responsibility for the position’s reaching this point, and we are truly sorry that it affected the price.”

The team also said it accepts accountability for its stances and regrets the effect on the cost. “We understand it hurts, even though it’s only temporary, and we apologise.”

Within the Cosmos ecosystem, Kujira is a blockchain that serves as a decentralized centre for money. A decentralized exchange, a lending platform, and a decentralized stablecoin known as USK are a few of Kujira’s primary features. Additionally, the network has a mechanism that allows users to liquidate their undercollateralized holdings. Over $42 million worth of value has been locked on the blockchain.

According to the team’s statement on Telegram, “As a team, we thought the best use of a portion of the ops funds would be to leverage and deploy across the ecosystem to bootstrap liquidity and activity,”

They further claimed that some individuals aimed their attacks at its locations, but sadly, there were other assaults simultaneously. Since these roles were established, there has been ongoing fighting because people have targeted the team’s positions.

Additionally, the Kujira team refuted statements made on X by “certain influencers,” implying that the current state of affairs is a “rug.”

The community’s reaction to the DeFi platform team’s public statement was divided; Blockchain Ecologist, for example, called the choice “extremely irresponsible management.”

Claims that the whole treasury is in danger were refuted by the team, who stated that 14 million native KUJI tokens are still “safe and sound in the treasury.”

According to the Kujira Operational DAO plan, the DAO would assume control of the core protocols and Kujira Treasury “with an initial mandate to safely reduce debt.”