Fantom surges 12% due to rumors of Andre Cronje returning to DeFi

Before the rumor of Andre Cronje returning to the DeFi market, the value of Fantom (FTM) unexpectedly spiked.

According to data from CoinMarketCapFantom (FTM) witness the value 12% spike in the last 24 hours alone, reaching a daily high of 0.502 USD early today.

In the last seven days, FTM also recorded an impressive increase 45%making it the best performing crypto among the industry’s 100 biggest assets.

Many speculated that the reason behind Fantom’s latest price action was the news that Andre Cronje was making a comeback. He was a DeFi (decentralized finance) developer at its peak.

Less than three months ago, Cronje announced that he was leaving the crypto space, along with fellow developer Anton Nell. This caused a strong shock in the community, causing FTM and YFI to sell off quickly, causing a serious price drop.

However, recently, many investors have discovered on GitHub that Cronje is working on the protocol fMint – Fantom’s platform helps to mine fUSD. While fUSD is the stablecoin of the Fantom blockchain, which has dropped significantly in value over the past few weeks.

The cause of fUSD being de-peg (losing the value of 1 USD) is said to be the inevitable pressure from the collapse of TerraUSD(UST). However, not to panic investors, Fantom fund emphasized on Twitter that fUSD is not like UST:

“fUSD is an over-collateralized stablecoin (similar to DAI) backed by FTM.”

“UST has nothing to back it up. Users generate fUSD by borrowing against their deposited FTM. If the value of the FTM is less than the minimum collateral rate, the FTM will be auctioned off gradually. for users who bid in fUSD (to keep the price).”

The UST Fantom Foundation says there is no auction process, and elaborates on how fUSD functions will be announced. “in the coming weeks.”

At press time, fUSD is trading at 0.7 USDmuch lower than the closing level of 1 USD.

In addition, according to a source from Colin Wu (a Chinese news site), Cronje has made a proposal to optimize Fantom fUSD, while the Fantom address associated with the developer has added nearly 100 million FTM recently. This is seen as a sign that Cronje is returning to Fantom.

In more detail, within the past two weeks, 11 The transaction has been exchanged to this address with 9,999,998.99 FTM each batch. The latest transaction took place at the beginning of May 23.