Alice: Where We Are Now.

At Alice, we set out to build products that would bring joy to more people. It was our belief that the world needed a non-custodial wallet using a decentralized stablecoin. Our vision when we founded Alice was to build a simple and easy-to-use non-custodial wallet for everyday commerce, all the while retaining self-custody. We hoped to enable the use of UST for real-life payments with the broader Terra community. 

Alice Puts Users First, Launches a Settlement Program.

We are proud to announce that on June 29, 2022, in our ongoing support of our users, we launched a settlement program to users who had a positive UST balance in the user’s 3rd party custody up at the time of May 25, 2022 (prior to the app update). 

Users that qualified for the settlement program received an email notifying them of their eligibility followed by a DocuSign setting forth the settlement terms. This settlement program does not extend to UST balances that may be in a user’s non-custodial wallet. We are very pleased with the positive response from our users and the number of users that have accepted the settlement. For users that received the settlement offer, be reminded that it remains open through July 8, 2022. Users that do not accept the settlement offer will not receive a distribution and may lose the opportunity to receive any distribution from Alice in the future.

Recap — How Alice Was Designed.

Alice was designed to keep the user in control. It is important to understand how Alice works to understand what happened to our users during the UST de-pegging. We designed Alice so that only our users have access to their private key. This was designed to build a payment application without sacrificing self-custody. Because it is a non-custodial wallet, Alice had no direct ability to send users’ UST to external Terra wallets. Alice acts merely as a pass-through for our onramp/offramp partners who facilitated money transmission and acted as a counterparty for UST-USD trades.

Alice has always focused on reducing and disclosing risk to its users. In addition to the known and disclosed risks associated with Terra and UST that were disclosed and known to the Terra community, Alice made risk disclosures on the mobile app and footer on the homepage as a reminder, including the risk of a UST de-peg. Alice focused on protecting against technical failure in the Anchor Smart Contracts (for example, through our planned partnership with Risk Harbor to introduce risk-mitigation with respect to smart contract protection). Alice did not have any control over, or impact on, the UST de-pegging or direct control over its service providers involved in the onramp/offramp.

Users who have UST in their non-custodial wallet always retained full custody over their assets and are advised to export their private key and withdraw from Anchor if they haven’t already.

Where is Our User's UST or USD?

Broadly, there are two types of users with pending fiat on/off-ramp transactions with UST that remain in 3rd party custody: (1) Users with pending USD-UST onramp and (2) users with pending UST-USD offramp. 

1. Users with pending USD-UST onramp
   These users initiated a fiat onramp from USD to UST during the de-pegging event. For many users, the USD to UST trade failed. This means USD remained in end-user’s account with our 3rd party custody partner. All USD in an end-user’s 3rd party custody account have been released back to the originating bank account. For trades that were completed, those users now hold UST with our 3rd party custody partner, which users can retrieve back to their non-custodial wallet directly via the mobile app.
   
   
2. Users with pending UST-USD offramp
   Our understanding is that these users have sent UST from their non-custodial wallet to their custody account with our 3rd party custody partner to offramp the UST to USD. The 3rd party custody partner shut off UST to USD trades and the UST remained with the 3rd party custody partner. Users can retrieve their UST back to their non-custodial wallet directly via the mobile app.
   
   The settlement program only applies to users who had UST with our 3rd party custody partner up until May 25, 2022 from the two aforementioned circumstances.

What’s next

As we have stated previously and continue to demonstrate, at Alice we will continue to do what we can to support users in the aftermath of the UST de-pegging.