Dough Finance, founded in 2024 in Florida, offered high returns through risky DeFi strategies. However, a hacking incident in July 2024 led to significant losses.
A Brief History of Dough Finance
Dough Finance was established by Chase Herro and Zak Folkman to provide users with high-yield opportunities through a strategy known as ‘looping’. This process involves multiple cycles of lending and borrowing crypto assets. However, in July 2024, a flash loan attack resulted in a loss of $2.5 million.
Defrauded Users and Unfulfilled Promises
User Jonathan Lopez, who invested $1 million, fell victim to the hack despite having received guidance from co-founder Chase Herro. Although promises were made to recover funds, users did not receive adequate compensation, and the remaining funds turned out to be minimal. The disappearance of communication from the company only increased dissatisfaction among investors.
Transition to World Liberty Financial
Following the collapse of Dough Finance, Herro and Folkman relaunched their business under the name World Liberty Financial, garnering attention due to ties with Donald Trump. However, many critics pointed to serious transparency and revenue structure issues, raising questions about the reliability of the new platform.
The case of Dough Finance and the subsequent launch of World Liberty Financial highlight the importance of caution and awareness among investors in the DeFi space. The founders' past mistakes raise concerns about the safety of new projects.
