The developer who single-handedly pulled Solana TVL to tens of billions of dollars

Original title: "Master of Anons: How a Crypto Developer Faked a DeFi Ecosystem"

Original author: Danny Nelson&Tracy Wang, CoinDesk

Original Compilation: Ten Articles, Odaily Planet Daily

For crypto user Saint Eclectic, Sunny Aggregator (a DeFi aggregator on Solana) does something different too normal.

Sunny’s native token quintupled during last summer’s bull run. In early September, when Sunny was less than two weeks old, billions of dollars in cryptocurrency were pouring into the yield farm.

Still, Saint and others still have questions: Who is behind Sunny? Why does this developer use the pseudonym "Surya Khosla"? Is its codebase audited? Is the user's cash safe?

“There was no indication of who Surya was,” Saint recalled recently, “and a lot of users didn’t feel safe putting their crypto in there.”

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It turns out that their suspicions were correct. CoinDesk has learned Surya, formerly known as Ian Macalinao, is the lead architect of Saber, the stablecoin trading platform on Solana. He built the Sunny Aggregator on top of Saber.

Ian, a 20-something computer expert from Texas working as a team of 11 independent developers, created A huge chain network of DeFi protocols has been built, projecting billions of dollars of double computing value into the Saber ecosystem. Last November, when the network was racing toward its apex, it briefly boosted Solana's Total Value Locked (TVL) - a TVL that DeFi loyalists tend to see as a rain or shine for on-chain activity surface.

“I devised a scheme that maximizes Solana’s TVL: I will build protocols that stack on top of each other so that $1 can be counted multiple times, ’ Ian wrote in a never-before-published blog post reviewed by CoinDesk. This blog post was prepared on March 26, three days after Cashio, one of the protocols Ian secretly built, lost $52 million in a hack.

People with knowledge of the matter have confirmed the authenticity of this content.

Peak reached

Ian's strategy worked for a while. By his count, Saber and Sunny at one point accounted for $7.5 billion of Solana's $10.5 billion TVL peak. (Billions of dollars were double-counted between his two protocols.)

"I believe it contributed to the price increase of SOL". Ian wrote when SOL was $188.

According to data provider DeFiLlama,Even though the Saber ecosystem begins to lose momentum in mid-September 2021, the TVL of the Solana network is still It continued to balloon, hitting $15 billion around November 9th, and Saber's TVL had dropped 64% by then.

Ian writes that he disdains such "vanity metrics"; although "Ethereum's TVL is much higher than Solana's TVL , which bothers me”, because in his view, DeFi projects on Ethereum are “stacked” and deposits can be double-counted.

"I want to create a system very similar to this," he wrote. One problem: “If every protocol was built by the same team, then TVL would be even more stupid as a metric. So I created more anonymous profiles” , he wrote.

Ian wears 11 masks.

In public, Ian and his brother Dylan refer to their anonymous personas as "friends" or "friends of friends". Their "Ship Capital" programmers club is creating "a blueprint for my ideal DeFi ecosystem," Ian wrote in an unpublished blog post. Saber and its so-called LP Token underpin everything.

"An ecosystem doesn't look so real if it's all built by a few people," Ian wrote in his blog post. "I wanted it to look like many people were building our protocol, rather than 20+ unrelated programs running as one person."

Ian hopes that other encryption protocols will be able to rely on Saber, to the point that "its failure may bring down the entire system," Dylan said on October 1, 2021. "This is Saber Labs' strategy, but few people understand..."

As of press time, Brother Ian did not provide any comment.

"Sybil attack"

There may be valid reasons for using anonymity. However, Ian "Anonymous" launched a Sybil attack, abusing the trust of cryptocurrency users. (A sybil attack is when a computer on a network uses a false identity to gain detrimental influence over the entire network.)

“I disclose this because I am sure be found". Ian wrote in his never-before-published blog.

However, Ian released "Saber Public Goods" in May to spread the prolific code of the "Saber Team" throughout Solana. Eight of Ian's 11 secret projects appear there. But they did not disclose the anonymity.

"My Anonymous Army"

Ian created under the name of Surya Khosla Sunny Aggregator and founded Twitter in August 2021. Sunny skeptic Saint Eclectic is hesitant to deposit his LP Token in the project of the mysterious figure, who is an AI-generated face.

There is one factor in Surya's favor: Ian's puppet claims to "know very well in real life" the Dylan brothers. On September 9 last year, Dylan Macalinao tweeted: "I feel comfortable putting my own cryptocurrency into Sunny Aggregator" and "We reviewed their code."

Dylan gives Surya the credibility he needs to win over doubters like Saint Eclectic.

The problem is, the main developer "Surya Khosla" does not exist. Dylan's brother Ian founded Sunny Aggregator. Ian made up Surya.

This is the first time Ian has used a fake identity for Saber, and it will be far from the last.

Ian wrote in March 2022 that he had created 11 "anonymous founders, all of whom were in fact fabricated by himself".

According to Ian's blog, he admitted to creating this batch of lesser-known protocols such as Crate (run by kiwipepper), aSOL (0xAurelion), Arrow (oliver_code) , Traction.Market (0xIsaacNewton), Sencha (jjmatcha) and Venko App (ayyakovenko), these DeFi Lego blocks are the gems of the Saber ecosystem.

Behavior between Anonymous

Ian, Dylan and the puppet Anonymous are constantly socializing Promote Ship Capital's work in the media. They compliment each other on each other's projects and constantly encourage and publicize the exploits of the builders.

On December 29, Solana developer Armani Ferrante (real person) tweeted: "If you don't make mistakes, you are too slow", 5 An Ian puppet responded within four minutes:

@_kiwipepper responded: "As @simplyianm said, it was an experiment!" She herself was one of them.

Others waver before the facts.

We have been unable to determine whether these comments were made by Ian behind Twitter. But two people who have worked with Ship Capital recall inexplicable behavior among their team members: One character's Telegram account would come online after another logged out.

In any case, Ian stated in an unpublished article: "If you are a developer, it is easy to find out which open source agreements I wrote: always There is a "flake.nix" file that only I use.

CoinDesk verified that many of the projects described in Ian's blog contained a "flake.nix" file.

Start with Cashio

To understand how the "Anonymous Army" injects the value of double counting Saber, the Cashio project created by 0xGhostchain provides a compelling point.

Cashio's CASH was unveiled near the peak of the crypto market in November last year, dubbed a "decentralized stablecoin," and its dollar-pegged cryptocurrency is backed by " Liquidity Provider" Token support.

Cashio only accepts Saber's LP Token as collateral. This was not surprising back in November, when Saber, an "automated market maker" with over $1 billion in TVL, was the main DeFi trading platform for stablecoin pairs on Solana.

Cashio relies on Ian's anonymous Saber ecosystem project to generate revenue.

It first uses Crate to package Saber LP Token into a "Tokenization Basket", which Ian built under the pseudonym "kiwipepper". It sends these “baskets” through a yield redirection platform called Arrow — which Ian built as “oliver_code.” Finally, Cashio says it earns its income by betting on these deposit derivatives in Sunny Aggregator in “Surya” and Quarry, which Ian built under the name “Larry Jarry.” Profits flow to Cashio’s treasury, managed by a Decentralized Autonomous Organization (DAO).

Confused? The same goes for Cashio's customers. CoinDesk asked two of Cashio's prominent users to explain the app's intricacies; neither of them could, because the app's associated page wasn't helpful.

Users care about this: Cashio's DeFi machine accepts them Saber LP Token and spit out CASH Token.

This is a profitable deal. CASH holders can deposit their LP-backed stablecoins into the Sunny liquidity pool and earn 10%-30% returns. One trader said that if they deposit Saber LP Token in Sunny instead of Cashio, they will only get 5%-10% profit. It doesn't matter that the same crypto asset is behind both.

This is the logic of DeFi currency Lego.

Forced deposits from Saber to Cashio to Crate to Arrow to Sunny or Quarry have a greater effect on Saber. According to Ian, it turned a $1 TVL into $6. Many DeFi projects measure their TVL by touting total user deposits.

Ian wrote: "TVL can only be calculated if the protocol is established separately", which explains why his anonymity The agreement of the latter is established separately.

According to TVL tracker DeFiLlama, Saber's deposits peaked at $4.15 billion on September 11, 2021; A peak of 90 cents was reached. Sunny Aggregator's TVL also peaked on September 11 at $3.4 billion. Its SUNNY Token had hit an all-time high of 18 cents the previous day.

Both tokens plummeted 99%, according to data provider CoinGecko. Saber and Sunny barely fared better in terms of TVL as they both fell by more than 96%.

Cashio hacked

Cashio was hacked on March 23 for $52 million Hacked and imploded, it was a big blowback to Ship Capital.

In an unpublished blog post, Ian said he was "working really hard to push people to put more money into Cashio" because he wrote its code. He apologized for their "catastrophic" loss in an agreement he created under a pseudonym and endorsed under his real identity.

In an unpublished post, Ian begged the hackers to return the funds. The hacker did later return $14 million of the $39 million demanded by victims.

Ian wrote that if the hackers don't reimburse users in full, "I will do my best to reimburse affected individuals with my personal Saber and Sunny Token users. This won't cover the full amount, but it's all I can offer". But he never kept that promise.

Ian's first code commit was on the EOS project

Anonymity is common in cryptocurrencies , is not in itself evidence of wrongdoing. Thirteen years after Bitcoin's debut, the true identity of its creator, Satoshi Nakamoto, remains unknown. And, even after the latest brutal sell-off, the "grandfather of cryptocurrencies" still has a market cap of $442 billion.

Ian stated in an unpublished article: "I just want to focus on building and creating value in what I believe is the best way of doing things. I Not wanting to deal with too much criticism before my idea is fully marketed, and anonymity is an easy way to distance myself (and the protocols I work on) from that."

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According to the records of the Discord server,Ian came to Solana in October 2020, but this is not his first code experiment. His GitHub commit history goes back more than a decade, with the first public cryptocurrency contribution in late 2017 on an EOS project.

In early January 2021, Ian discussed the token economics of the doomed Stablecoin on Basis.Cash's Discord. There, he became "obsessed" with building a decentralized currency.

On this road, he tried to "build a multi-protocol DeFi ecosystem", but ended up with criticism and ridicule. "Moving to Solana was a way for me to start over," says Ian.

Who is Saber's anonymous builder?

Who are these anonymous builders flocking to Saber? At last year’s Solana conference in Lisbon, Portugal, Ian addressed how Saber became the largest DeFi application on Solana in a panel discussion titled “From $0 to $2 Billion.”

Ian told Race Capital (Saber's largest venture capital backer): "We have attracted some friends and are ready to build on Saber's foundation and develop out of the ecosystem".

A "friend" item is Sunny. The other is the Tokenized Basket Making Protocol Crate from Ian's alias kiwipepper. "They made a lot of friends," says Ian. One of these friends built Cashio, a stablecoin project backed by the Saber LP Token to feed liquidity to Sunny Aggregator. “We can promote CASH and let more liquidity enter Saber,” he said.

In a brief interview with CoinDesk on Thursday, McCann said he was unaware of Ian's close relationship with Cashio.

"He keeps mentioning that someone else made it, but I don't know who the others are and I haven't met them."

In an unpublished blog, Ian reveals the true origin of Cashio. As the code for 0xGhostchain, Ian is eager to complete a prototype of a Saber LP-backed stablecoin before Breakpoint, the largest developer gathering ever in the Solana ecosystem. Ian hopes others will replicate Cashio. Every protocol that relies on Saber LP Token will become a liquidity vent, pouring more TVL into the $1.7 billion mothership.

“This is part of the reason the code is insecure, it was rushed to meet this deadline,” he wrote on March 26, A hacker previously defrauded Cashio's unaudited smart contracts with fake collateral, costing it $52 million.

Users on Cashio's Discord community may trust that CASH codes are safe. After all, Ian told them on November 23rd: "I reviewed it myself". However, he told Crypto Twitter on March 23, the day the breach occurred, that “I didn’t vet Cashio as carefully as I should have.”

Both of these claims contradict what Ian wrote in his unpublished blog.

Continue to develop towards Aptos

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“It has always been our goal to create projects with real names,” Ian wrote in an unpublished blog post.

On July 23, the brothers began to solicit external developers from Saber through a "DAO Accelerator Program". Its application form includes: "How will your protocol be deeply integrated with the Saber protocol to increase the number/TVL/capital efficiency of Saber?"

The effort came at the same time as the brothers moved from Solana to emerging blockchain Aptos, porting Saber onto Aptos. Three sources say Ian is betting on this:They lead a venture capital firm backed by Aptos called Protagonist. Its old name was"Ship Capital".

Seven Saber ecosystem users told CoinDesk they felt abandoned by Brother Ian. Some CASH Token losses (formerly Stablecoins go to zero). Others said their cryptocurrencies were trapped in derivative tokens issued by Sunny. Anonymous user Brad_Garlic_Bread said he lost about $300,000 on Sunny and Saber - "There are a lot of people worse off than me."

The community thinks Ian was in Preside over the big picture, "but no one knows the real situation", Brad_Garlic_Bread said. He's still trying to get Ian's attention. On July 16, Brad asked Ian if he could "pretend to be Surya for a day" to help Sunny Aggregator investors recover their locked tokens. Ian skipped this question when answering it in the Saber Discord.

Other SUNNY Token holders asked Ian about the future plans of yield aggregators: Saber is moving to Aptos, will Sunny do the same?

Ian said on July 16: Sunny's lead developer lost most of their savings from the Cashio hack. He will "encourage" the dispirited developer to rebuild Sunny in Move, the Aptos development language, a coding language Ian says is safer than Solana's Rust and can build multimillion-dollar protocols.

A week later, Ian said that the Sunny developer After trying Move, I feel rejuvenated.

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