SushiSwap migrates liquidity from Uniswap in the 'vampire attack'
SushiSwap, a fork of Uniswap, performs 'vampire attack' draining hundreds of millions in liquidity, highlighting Wild West nature of DeFi that Bitcoin largely avoids.
On September 9, 2020, SushiSwap migrates liquidity from Uniswap in the 'vampire attack'. SushiSwap, a fork of Uniswap, performs 'vampire attack' draining hundreds of millions in liquidity, highlighting Wild West nature of DeFi that Bitcoin largely avoids.
While this was primarily an Ethereum and DeFi story rather than directly about Bitcoin, it was relevant to Bitcoin's history because it demonstrated risks and instability inherent in complex, rapidly-evolving DeFi protocols that Bitcoin's simpler design largely avoided. The SushiSwap vampire attack worked by creating a nearly identical copy of Uniswap's code (which was open-source) but adding a governance token (SUSHI) that would be distributed to users who provided liquidity.
Uniswap, despite being the dominant decentralized exchange, hadn't yet launched its own governance token, creating an opportunity for SushiSwap to offer additional incentives. Liquidity providers who migrated from Uniswap to SushiSwap would receive SUSHI tokens on top of their normal trading fees, making SushiSwap economically attractive despite being a new and untested platform.