Fei Protocol
Shut DownStablecoin · $FEI · ✝ 2022
An algorithmic stablecoin that broke peg on day one.
Fei Protocol was an algorithmic stablecoin that launched in 2021 with over $1.3B but broke its dollar peg almost immediately. After merging with Rari Capital and suffering a major hack, the TribeDAO voted in 2022 to wind down and let holders redeem.
- Peak
- ~$1.3B+ at launch
- Cause
- Shut Down
- Year of death
- 2022
☠️ Cause of death
Its peg-stability mechanism failed at launch and the project never recovered, with governance ultimately voting to shut down and redeem.
📓 Lessons left behind
- —Algorithmic peg mechanisms often fail their first real stress test.
- —Merging with another protocol imports its risks and bugs.
- —An orderly DAO wind-down beats a slow bleed.
🌱 The idea that survived
Honest stablecoin design
Reinforced skepticism of purely algorithmic pegs in favor of well-collateralized stablecoins.
#stablecoin#algorithmic#depeg