Key Takeaways
- Compound DAO authorised proposal 289 and awarded 499,000 COMP tokens to at least one consumer.
- The proposal raises considerations about the potential of Compound’s governance being managed by a single organisation.
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Mixed governance authorised Proposal 289 On July 28, a proposal to create a yield vault by giving 499,000 COMP tokens to a consumer named Humpy was authorised, which was value greater than $25 million on the worth on the day of approval. Nonetheless, customers in the neighborhood identified that the proposal was an assault on Compound’s governance and might be taken hostage by the whale.
Humpy has been shopping for COMP tokens for the previous three months to realize sufficient voting energy to approve Proposition 289. Moreover, the whale applied the identical technique for Balancer governance in 2022, Blockful CEO Alex Netto defined.
“At first look, this doesn’t appear to be an assault as a result of this whale invested some huge cash to realize important voting energy in Compound’s DAO. Nonetheless, while you perceive this consumer’s behavioral patterns, you begin to assume once more that that is an assault,” Nett added.
Notably, enterprise capital fund a16z has delegated the biggest voting energy on Compound’s governance, a degree highlighted by Blockful product supervisor Daniela Zaber: “Their vote might have blocked the approval of Proposition 289, however they did not. There’s nonetheless quite a bit to determine,” Zaber stated.
Furthermore, if COMP holders do not get up for this, Compound’s governance might turn out to be hostage to Humpy. By locking COMP tokens within the yield vault, whales obtain rewards within the type of extra COMP tokens, which in flip will increase their voting energy. “In the long term, this seems to be like an assault,” Netto concluded.
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