SushiSwap Head Chef Suggests Cooking Up New Token Model – Will The DEX Survive 2023?

Christian Encila

Last Updated: March 8, 2023 7:26 am

3 mins read

Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Created by industry experts and meticulously reviewed

The highest standards in reporting and publishing

How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

On December 7, Jared Grey, the CEO and “Head Chef” of SushiSwap, suggested that the DEX is burning through cash like there is no tomorrow.

According to the forum post made by Grey, the DEX has, more or less, a year and a half in headroom which resulted in the exchange enacting a 100% allocation from fees on its staking token xSUSHI.

This 100% allocation, however, is temporary until the DEX’s situation improves or new tokenomics are enacted. Will this proposal be the answer to SushiSwap’s urgent situation?

New Year, New Tokenomics

Grey’s current proposal, if passed, is a technical undertaking for the DEX which could save it from its current state. According to the proposal, liquidity providers, or LPs, will receive a share of the 0.05 % swap fee on the ecosystem.

Chart: Sushi Tokenomics Proposal PDF

They can also lock their liquidity to earn emission-based rewards with a soft-lock system, meaning that they can pull their liquidity out before it reaches maturity but they lose their rewards.

xSUSHI rewards are also updated. The token would lose its previous cut on the fees and will be replaced with an emission-based rewards system. The soft-lock system will have differing rewards for different lock tiers.

The emission APY, according to the forum post, will be around 1-3% if instated. The new tokenomics would also introduce token burning in the form of buy backs of SUSHI and burning off the rewards if the locked liquidity or xSUSHI is pulled out.

As I promised in Sunday’s tweet regarding Sushi’s Budget Snapshot for 2023, I am making the DAO operating costs public. Transparency is a critical component of a successful DAO. You can see most budget costs are salaries. 1/ pic.twitter.com/rVHXEJSfLR

— Jared Grey (@jaredgrey) December 13, 2022

Issues Wafting In The Air For SushiSwap

Although the new tokenomics look sound, a comment on the December 7 forum post shows something different. According to user GoldenNaim, the platform is currently using $4 million of the calculated $5 million operating budget for wages.

This is incredibly troubling as this only leaves the team a measly $1 million for making SushiSwap better through innovation. Jared Grey’s reply to this is just:

“Yes, we need to pay people competitive wages to work at Sushi.”

SUSHI total market cap at $217 million on the daily chart | Chart: TradingView.com

But it seems that the proposed tokenomics has an effect on SUSHI’s price. According to CoinGecko, SUSHI has jumped by 1.8% in the past 24 hours with the biggest rally in the weekly timeframe at 2.8%.

The DEX’s fundamentals are also looking bullish as Cryptolaxy, a crypto fundamental and technical analysis platform, show that SUSHI is undervalued to some degree. If SUSHI is to recover from 2022 market woes, the token must break through $0.9849 resistance.

As the year progresses forward, we’ll see if SushiSwap will implement its proposed tokenomics and save it from its current state.

-Restaurant Business Magazine

Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.