Blue Kirby is the name of a now famous thief in the decentralized finance (DeFi) community who appears to have fled with around $ 1 million in ether (quotation ETH). DeFi community members claim that Blue Kirby influenced or manipulated members of the Yearn.Finance ecosystem and then conducted a questionable initial coin offering (ICO) for a non-fungible token (NFT) market called “Off-Blue”.
The Blue Kirby scam marks the latest in a series of negatively illustrative stories from the 2020 "DeFi Summer". The episode shows how - in the absence of compensating factors - unauthorized technology, pseudonymous identities and borderless markets can create a explosive mixture.
Touch and run
According to Anthony Sassano of Set Protocol, Blue Kirby created his character online in the early summer months, in the wake of Andre Cronje Yearn's robo-crypto hedge fund. The pseudonymous cheerleader quickly rose through the ranks of DeFi community members on Twitter.
Blue Kirby's poor judgment came to light over time, starting in late September with Cronje's unsuccessful release of Eminence, a new DeFi contract. Though Eminence was yet to be verified, Blue Kirby encouraged users to deposit funds.
Approximately $ 15 million was poured into the contract largely under the advice of Blue Kirby. With perfect timing, a bug in the contract was immediately exploited and a hacker drained all the money.
Although $ 8 million was returned, Blue Kirby's reputation took a hit. At this point, Blue Kirby doubled down by doing the unthinkable: he (or she, or they) sold his YFI tokens for $ 22.000 for a total of $ 550.000.
The token has dropped about 25% since that time, to $ 16.889, according to Messari. Blue Kirby concluded his three-month DeFi experience with an ICO of his Off-Blue governance token. The platform raised about $ 800.000 in Ether before its NFT Rarible host closed the market on October 10. Surprisingly, the ICO is currently offering refunds, but not before an investigation was posted on the anarchist forum 4chan to find out who the human face behind Blue Kirby is.
Community reactions
The Blue Kirby saga once again highlights the challenges created by pseudonymity in the cryptocurrency markets. Cryptocurrencies themselves have only been made possible through anonymity or aliases, said Erik Voorhees, longtime bitcoiner and founder of the ShapeShift exchange (the identity of Nakamoto, the creator of the first cryptocurrency, bitcoin, was never definitively determined after years of speculation, yet the asset remains the most valuable in the industry with a market capitalization of $ 216 billion).
An identifiable leader, after all, is probably a single point of failure for a technology that depends on not having one. “The problem with Blue Kirby wasn't that it was anonymous, it was new. The account came out of nowhere and people threw money at us ”.
