SushiSwap is a decentralized exchange (or DEX, for short), and the first product by Sushi. SushiSwap is also non-custodial, which means that—unlike centralized exchanges—SushiSwap does not need to possess your tokens in order for you to be able to trade them. Instead, SushiSwap allows users to trade trustlessly, peer-to-peer, with liquidity that is supplied by other users. This means that new projects can easily connect to their desired markets as long as some entity is willing to provide the liquidity. 
The two functions that SUSHI has are: entitling holders to governance rights and a portion of the fees paid to the protocol. In a simplified way, SUSHI holders own the protocol.
It was forked from Uniswap and created by the pseudonymous Chef Nomi (SushiSwap). Within three days of its announcement, SushiSwap accumulated over 1 billion worth of value locked into the protocol.
As of September 1, 2020, SushiSwap is an unaudited project and September 3, PeckShield just completed the SushiSwap audit with all identified issues confirmed or fixed.
In December of 2020, SushiSwap announced a merger with yEarn. This follows high profiles collaborations between yEarn and other protocols like COVER Protocol, Pickle Finance, Cream Finance, Akropolis, and others. yEarn is creating an xSushi vault to farm SUSHI, Ether (ETH), YFI, and Wrapped BTC (wBTC). Keep3r Network will add its treasury to SushiSwap. COVER Protocol is adding insurance for SushiSwap liquidity pools through their system of CLAIM tokens and Cream Finance will provide liquidity and add SushiSwap Liquidity pool tokens as collateral for lending.
Sushi's community can explore and discuss ideas on the official forum. Anyone can create a proposal regarding Sushi. Proposals are not limited in their content; the community can propose to change anything they see fit. The proposals which generate major community interest are then pushed to vote after the core team has reviewed them. The resulting decision is binding for all involved.
Major structural changes to the protocol and the use of the dev fund wallet are voted on by the community. Enacting transaction regarding the dev fund requires at least 6 out of 9 signatures from the multi-signature members.
Lesser changes and operational duties can be enacted by 3 out of 7 signatures from the operational multi-signature members.
Around early September, Chef Nomi acquired access to $27 million in Sushi tokens. The amount held by the lead in the company became mildly worrisome, as many had questions regarding why they held full access to this amount. Chef Nomi, in a Discord statement, stated,
In theory I can sell all of them, but I don't see anything wrong with it. It's the devshare and it's [been] specified in there since the beginning. It's not like I'm hiding that or anything. I [will] also spend for 2 audits. I will spend for the grants I just published a few hours ago.
A few days after this statement was made, SUSHI had suffered a loss in price per token due to Chef Nomi's mass selloff of around $13 million in dev funds. Many were suspecting that this was an exit scam from the creator, despite them denying that that was the case, and stating that they deserved the dev fund for creating the project. People in the DeFi space were not very pleased with the lack of transparency from SUSHI leaders. Many critics, including yEarn creator Andre Cronje, expressed his criticism towards the action, stating:
All you did so far was hand over a token that was built off of Uniswap Protocol. Weren't the funds meant to further develop? Aren't you that developer?
In addition to the selloff, the SushiSwap contract was officially transferred to Sam Bankman-Fried, after Chef Nomi gave it up. They were the sole owner of the contract prior to this exchange.
On September 11, 2020, Chef Nomi returned $14 million in funds to the SushiSwap community. Additionally, they apologized to the community for their actions. In a statement, they explained
I have returned all the $14M worth of ETH back to the treasury. And I will let the community decide how much I deserve as the original creator of SushiSwap. In any currency (ETH/SUSHI/etc). With any lockup schedule you wish.
They added that they would continue to support the project 'behind the scenes'. Meaning, they are going to continue working on the project's development.
SushiSwap (SUSHI) is an audited Decentralized Exchange (DEX) and DeFi (Decentralized Finance) protocol described as "Uniswap meets Yield Farming" with SUSHI tokenomics. The protocol's native token SUSHI is used to govern the platform. SUSHI holders also receive a portion of the trading fees on SushiSwap.
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