Haven (XHV) Stablecoin Reported As Exit Scam, Developer Responds to Claims

Rumors that Haven (XHV), a Monero-forked hybrid type of stablecoin, was an abandoned project and perhaps even an exit scam hit crypto social media yesterday (Jan 21), as the project’s non-critical team members publically decried the founder and sole developer’s lack of presence.

Haven was one of the most impressive gainers of late 2018, logging a nearly 8,500% increase in price agianst bitcoin between October 1 and November 13.

havenPrice.png(source: Coinmarketcap.com)

The (non-critical) Haven team member admissions that sparked concerns occured on the project’s Discord channel. Admin “news.cutter” complained that the project founder, “havendev,” had become unresponsive after requests to open the Github repository, to which he alone has access. News.cutter also complained that the developer fee - a portion of the reward for mining blocks - should be transparent. He vowed to leave, even if havendev were to return.

chat1.png(screengrab from Discord)

Another team member agreed with news.cutter but expressed his hope that the project could be forked and live on:

chat2.png(screengrab from Discord)

In the face of the kind of fear-uncertainty-and-doubt (FUD) common in the cryptoasset industry, havendev reappeared at the eleventh hour to assert that the project is not in fact a scam. He vowed to open up the code to the community, and said he had been working on it during his period of absence.

chat3.png(screengrab from Discord)

Clearly only time will tell what precisely the situation is. But whether or not the project is truly dead or a scam, it is clear to see on the project’s Github page that development activity has dropped off sharply of late.

commits.png(source: Github.com)

Haven - What is it?

Haven’s motto, according to its (extremely sparse) whitepaper, is “Untraceable transactions meets offshore banking.” It is essentially an algorithmically-backed stablecoin, perhaps similar to the Maker/DAI project. The whitepaper explains that “Users can mint and burn Haven [XHV] for the equivalent USD value worth of Haven Dollars [XHVD].”

The goal of this scheme, the paper states, is to put “a Swiss bank account in your back pocket.”

This is not the first time that doubts have plagued the Haven project. Last year, Haven was somewhat infamously associated with a series of leaked messages exhibiting an alleged pump-and-dump scheme, in which crypto influencers used social media to direct followers’ interests to certain coins that they had already invested in.

CryptoGlobe reported last year that this particular group was reported to the US Federal Bureau of Investigation and Securities and Exchange Commission by the leaker.

Wrapped Bitcoin Has Exploded Since Entering MakerDAO's System

After over a year of existence, the market capitalization of (Ethereum-)Wrapped Bitcoin (WBTC) has seen a steady rise since roughly March. Starting on about May 10, the USD value of bitcoins wrapped in WBTC smart contracts surged from about $10 million to over $35 million at the time of writing.

massive growth(source: DefiPulse.com)

This change in the WBTC chart represents a parabolic explosion of use, whereas the system had before rarely held more than $5 million worth of value on its network.

One explanation for this rise since March is of course the rise in general asset prices of cryptos like Bitcoin and Ethereum.

Another, more dynamic explanation for the surge, especially in May, is the recent addition of WBTC to the MakerDAO ecosystem. As covered by CryptoGlobe on May 4, Maker holders recently voted to allow WBTC as a form of collateral for minting DAI, a decentralized stablecoin.

DAI is created when another Ethereum-supported digital asset is locked in a smart contract against it. The underlying asset can eventually be released, and both the formation and dissolution of the locked smart contract is performed by paying a fee in MKR, MakerDAO’s native token (which also gives voting rights on the system). In addition to Ethereum (ETH) itself, Basic Attention Token (BAT) and USDC can also be used to mint DAI.

A complex system of balances is designed to keep DAI equal to one US dollar—although, since there is no central authority controlling supply, the peg is not always perfectly 1:1.

Featured Image Credit: Photo via Pixabay.com