EP 50: $FEI, What Went Wrong? An Economics Explanation

FEI protocol had all of twitter talking last week. 


Backed by significant VCs, this new algorithmic stablecoin
mechanism, $FEI, managed to raise US$1 billion worth of Ether
within the first 24 hours. And within 24 hours of launch, the
price of $FEI dropped significantly, as did $TRIBE, the
governance token.   


So what went wrong? How did the economics model and incentive
design fail so terribly? And what was the tipping point that
caused this massive disaster? Today, we analyse the lessons to
learn from $FEI, this new mechanism to create an algorithmic
stablecoin.   


Follow us on Twitter and join our Discord to chat with us and the
ED community.