The launch of the first “Genesis” block of the “Fei Labs” blockchain last Saturday, the project raised 639,000 Ethereum, or $1.3 billion.

a description Some analysts have called the Fei Labs crypto project “the largest launch in the history of DeFi.”

The biggest launch in Divi’s history? Tweet embed raised $1.2 billion from the Genesis event, and FEI dollars – tribe dollars The pool is ranked #1 on Uniswap with $2.6 billion in cash.

Meanwhile, retail investors got the expected.

Here’s how the drama unfolded:

– John Woo (@jonwu_) April 4, 2021

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The protocol of this project “Fei Labs” is designed to make delivering money in the protocol ecosystem much easier than withdrawing it.

The funding was raised by more than 17,000 members of Fei’s Genesis Group, who will be the first to adopt the new Fei protocol, which is now minting stablecoins pegged to the US dollar.

However, the current price of FEI is 88 cents, and twenty hours ago it was $1.26.

Just like the DAI stablecoin protocol, Fei’s method of pricing its stablecoin is algorithmically based.

The difference is that the method of peg, called “PCV,” or “Protocol Controlled Value,” which keeps the price in balance by acting as an automated central bank, selling and repurchasing cryptocurrencies as needed to maintain the $1 price.

To ensure that the protocol has the means to buy back coins, it requires some basic cryptocurrencies like Ethereum to act as collateral.

Here is the focus of the work of the “Fei” project.

In the event that the demand for the FEI cryptocurrency drops and the price falls, the Ethereum earned will go to buy back the coins to bring the FEI price back to $1.

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There are also disincentive mechanisms to penalize trading that exceeds the $1 price.

Currently, traders trying to sell the FEI at a higher price will incur huge fees.

Investors stuck:

Given that the FEI is now trading well below its one-dollar peg, many traders intending to sell are afraid of being penalized.

This makes launch conditions favorable for the FEI protocol while investors are stuck.

Simply put, the FEI protocol was not created to anticipate the high demand at the Genesis tee block.

Investors would likely pile on the protocol in the hopes of making quick returns, only to find that the currency fell in value immediately, holding them back from selling it.

It is worth noting that the “Fei” project has received investments from many big names and companies in the crypto field, such as:

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Coinbase, US venture capital firm Andreessen Horowitz, and DeFi VC firm Framework, whose investment fund last month raised $300 million in capital.

DeFi projects are risky:

With quick returns comes big risks.

Investing in Decentralized Finance (DeFi) projects can be a risky business.

Even if you understand how the protocol works, hard investments are all over the place.

Your money may be trapped in complex protocol labyrinths, or worse yet, in the hands of criminals, where we periodically address fraud stories and news, so be careful before depositing any money, and also make sure you do a good research on the project.

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