SushiSwap Head Chef Hit by Controversy in First Week

The DeFi platform’s top executive faces scrutiny over his past crypto ventures as Sushi adds another chapter to its history of leadership drama

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key takeaways

  • An investor in Jared Grey’s earlier DeFi project accused the head chef of mishandling hacks, though admitted to Blockworks his case was “speculative”
  • Sushi’s native token dropped 10% following the allegations

SushiSwap’s newly-elected top executive — or “head chef” — has been accused of mishandling wallet exploits at his prior employer. 

The allegations appear flimsy, but they still present a headache for the DeFi platform accustomed to leadership drama. And legal action is brewing. 

Jared Grey was elected head chef of SushiSwap on Oct. 3 via an on-chain election dominated by venture capital firms, and the accusations came as Grey was still an unfamiliar figure to many in the protocol. 

The purported misconduct centers around Grey’s alleged negligence during a string of 2019 insider hacks at DeFi protocol ALQO, as then-CEO. Twitter user @YannickCrypto, who worked with Grey to stem the ALQO hacks in 2019, outlined the accusations on Twitter Monday

SushiSwap’s native SUSHI token, which had already fallen 90% from its 2021 high, dropped another 10% on the news. The token had trended up following the election.

ALQO (since rebranded as EONS) allowed users to store cryptoassets using its wallet software, Liberio. In February 2019, Liberio users began complaining of suddenly-missing funds. At the time, Yannick released on-chain data suggesting one of ALQO’s developer wallets had been involved. 

Months later, Grey and ALQO concluded the account exploits were coming from ALQO’s chief technology officer Kevin Collmer. Collmer was fired soon after.

Yannick told Blockworks via Discord that Grey “knew about [the hacks] and did nothing” in the months between the withdrawals first being reported and Collmer’s firing “to milk the last dollars out of ALQO.” Pressed to provide evidence for his claims, the on-chain sleuth conceded his case against Grey was “speculative.”

One early ALQO investor told Blockworks that Yannick soured on ALQO following the hacks.

“You could almost say he was obsessed with [destroying ALQO],” the investor wrote.

In November 2019, ALQO published a blog post concluding “Kevin Collmer’s actions contributed directly to the loss of user funds on Liberio.” Collmer maintains his innocence, telling Blockworks that German law enforcement searched his belongings but found no evidence of his involvement in the series of hacks.

Grey insisted Collmer was behind the exploits, adding the ALQO co-founder was terminated when he made off with investor funds as ALQO planned to expand.

“He stole the money, ghosted us for [two] months, and then after we demanded the money back via a demand letter, he never returned it, and we fired him,” Grey said in a Twitter DM.

Grey is now suing, or about to sue, Collmer in Germany, according to sources familiar with the matter. Grey declined to comment on the lawsuit. 

Several hacked ALQO users told Blockworks that Grey was transparent about the hacks and refunded their coins — albeit at a lower price — following Collmer’s departure. 

Following the allegations, Grey fessed up to business failures on Twitter but denied any specific wrongdoing with ALQO. On Wednesday, Grey penned a blog rebutting each of Yannick’s allegations.

In his first week as head chef, Grey returned his earmarked severance package to the Sushi DAO treasury and teased SushiSwap stable pools.

But for the top executive of SushiSwap, controversy seems to come with the territory.


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