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Alameda-Backed Ren Warns Users Of Losses As It Plans To Wind Down Version 1.0
Ren Protocol warned its users of potential risk tied to loss of assets as it plans to shutter version 1.0.
Muskaan T.
12:01 9th Dec, 2022
Markets

Ren Protocol, an Alameda-funded issuer of a wrapped bitcoin asset called renBTC warned its users of the potential risk of losses after it shuts down its existing product.

The Ren team said that this tokenized bitcoin, referred to as Ren 1.0, would soon be shut down. The primary reason for the shutdown of Ren 1.0 is the lack of funding after the financial collapse of Alameda Research.

Ren allows bitcoin holders to lock their assets and mint a wrapped version that can be used on Ethereum, but this mechanism has been put on hold for some time. After Ren’s version 1.0 is shuttered, it will be replaced by a new community-run Ren 2.0.

But the two versions may not be compatible. The project told users to immediately burn the circulating tokens on Ethereum and claim them back to the original chain as soon as possible to protect themselves from potential risk. “As compatibility between Ren 1.0 and 2.0 cannot be guaranteed, holders of Ren assets should bridge back to native chains ASAP, or risk losing them,” the team noted.

According to data from The Block, there are currently 1130 renBTC ($19.2 million) that exist on Ethereum. After version 1.0 is retired, it’s possible its holders may not be able to recover their assets, as noted by the team.

Earlier this year, Alameda Research, the trading firm closely linked to FTX, acquired the Ren project and funded its development each quarter.

After Alameda and the FTX exchange filed for Chapter 11 bankruptcy protection, Ren said its main source of funding would be removed, forcing it to wind down. Ren's team previously said it was left with a runway that would finish at the end of the year.

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