Stargate Foundation asks DAO not to issue STG tokens

Due to concerns highlighted by FTX liquidators, Stargate Foundation has recommended its decentralized autonomous organization (DAO) against reissuing Stargate’s native Stargate Finance (STG) token.

According to the liquidators, such an action would breach the automatic stay and might result in legal ramifications.

Alameda Research, a former bitcoin trading company, acquired the whole STG auction for $25 million in March 2022.

Nevertheless, in November of the same year, FTX entered bankruptcy, after which hackers stole around $500 million from FTX and Alameda. Eventually, the liquidators moved all assets to new wallets.

In light of these occurrences, Stargate DAO has recommended reissuing the STG token to transfer the cash from the hacked wallet to a more secure one.

The FTX liquidators, however, have rejected this suggestion.

The DAO asserts that the liquidators’ fears are unjustified and that the issuance of STG tokens would not breach the automatic stay.

Stargate noted that “nothing in the foundation’s interactions with the liquidators suggests that they have a strong knowledge of the realities of the smart contracts, how the contracts function, or how they would engage with the contract to safeguard the cash.”

Notwithstanding the efforts of exchanges, protocols, and other parties to assure the safety of money, the foundation maintains its stance against the issuance of the STG token based on the view of FTX liquidators.