DeFi Protocol Parrot Finance Implements Token Redemption
Parrot Finance, a DeFi protocol, is set to begin redeeming its PRT token as part of an activist investor-led plan. The redemption follows a highly contentious vote that returns a portion of Parrot Finance’s treasury to token holders. Early investors are angry with the proposal as they would only recoup one-tenth of their initial investment, while Parrot Finance’s treasury would retain around $73 million.
Controversial Vote to Buy Out Investors
- Parrot Finance raised over $80 million during its public token sale two years ago.
- An ongoing vote proposes the end of Parrot’s governance token through a redemption program.
- The redemption offers $50 million from the treasury to PRT token holders at a price of $0.0045 each.
- Investors argue that the team broke their promise of giving token holders more control over the protocol.
- The proposal angers investors as they would only receive a fraction of their investment.
Token Buyback Plan Moves Forward
- Parrot Finance plans to purchase PRT tokens from sellers at a price of $0.0045 each.
- The redemption period will last for eight weeks.
- The plan faced backlash from smaller investors who accused the team of keeping a major chunk of the treasury for themselves.
- The greenlighting of the plan comes after a community vote in which 99% voted in favor.
- Activist investors are likely to profit from the buyback and gain complete ownership of the protocol.
Original Investors Face Huge Losses
The original investors in Parrot Finance and its PRT token are expected to recover only about a tenth of their initial investment. The Parrot team and activist investors stand to make significant profits from the plan, leaving retail investors with substantial losses.
Hot Take: Promises Broken, Original Investors Left with Pennies
The redemption plan by Parrot Finance has caused outrage among early investors. The team’s failure to fulfill their promise of giving token holders control over the protocol has resulted in significant losses for retail investors. Meanwhile, the team and activist investors are set to profit from the buyback. This situation highlights the risks and potential pitfalls of investing in DeFi projects.
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