Optimism Foundation Privately Sells $90M Worth of Governance Tokens Amid Mixed Community Reactions
Summary:
The Optimism Foundation, responsible for Ethereum's layer-2 blockchain, recently sold approximately 19.5 million of its governance tokens privately. Despite the two-year vesting period attached to these tokens, the new owner can still participate in governance. The tokens sold form part of an unallocated portion of the foundation's treasury. While the foundation intends to carry out delivery of the tokens via several planned transactions, it has not disclosed further details about the sale or buyer, sparking various reactions within the community.
The team behind Ethereum's layer-2 blockchain, Optimism, is under the Optimism Foundation. Recently, the foundation disclosed in an announcement that it had privately sold close to 19.5 million of its governance tokens. Each of these Optimism (OP) tokens is currently valued at around $4.62, making the total worth of the sold tokens approximately $90 million. However, there is a catch - the tokens come with a two-year vesting period, meaning the new owner cannot sell the tokens until this period elapses.
Interestingly, during this lock-up period, the new tokens owner doesn't lose their rights concerning governance participation. In fact, they can delegate the tokens for governance purposes to third-party entities that are not affiliated with them.
The OP tokens sold were reportedly part of an "unallocated portion' from the foundation's OP token treasury. These are assets that form part of the foundation's operating budget, which is equivalent to 30% of the OP token's original supply. The foundation added that the delivered OP tokens would be done through several transactions to be carried out in the coming days.
Despite the foundation's assurances to its community that these are transactions originally planned and linked to the tokens sold privately, it did not reveal specific details surrounding the sale or the buyer. This reticence sparked discussions and debates across several platforms, with some members slamming the secrecy, while others defending the foundation's actions.
Simultaneously, certain community members pointed out that the Optimism team also needs to make money for survival. The dissent and defense of the private sale was even amplified on social media platforms. One notable critic was Ethereum advocate Anthony Sassano, who while a fan of and investor in Optimism, expressed his dislike of private sales without disclosure describing it as leaving "a bad taste" in his mouth.
In September 2021, Optimism sold 116 million OP tokens worth about $160 million privately. Notably, these tokens also had a two-year lock-up period. The move sparked concerns about a negative impact on token prices amongst some community members, which has remained unfounded since the lock-up period prevents an immediate effect on the token's price.
Published At
3/8/2024 2:22:38 PM
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