SushiSwap Gains Approval to Transition to 'Labs' Model Amid Community's Mixed Reactions
Summary:
The decentralized exchange, SushiSwap, has gained approval from the majority of voters to transition to a less decentralized 'labs' model. With Sushi Labs set to autonomously manage the exchange, the new model triggered heated debates within the community, resulting in some members expressing concerns over Treasury's financial health and alleged manipulation of voting power. Despite opposition, advocates believe the Labs model could help recover SushiSwap's falling market share. Now, the community waits for the implementation vote to finalize the proposal.
SushiSwap, a decentralized exchange, has obtained majority approval to embark on a contentious move towards a model with less decentralization. The 'labs' model proposition, signaled by a completed vote on April 10, had garnered approval from over 62% of voters. Initially proposed on March 26, this has sparked intense conversations among its communities. The plan outlines the formation of Sushi Labs, intended to autonomously manage the Sushi ecosystem in technical, operational and administrative aspects. Still, tokenholders will retain control over treasury allotments without delving into operational specifics. As proposed, Sushi Labs would amass 25 million SUSHI tokens, approximately $39 million in today's value. Moreover, future airdrops from partnered protocols and associates would be exclusively allocated to Sushi Labs.
The immediate tasks for Sushi community members include casting their votes on the execution plan by April 17. Close to seven million tokens currently favor the proposal, indicating a high approval percentage of 92%. In the proposal's context, a signal vote implies a preliminary move to gauge community sentiments on a particular proposal without rendering any alterations. Conversely, an implementation vote appears as a follow-up step where the community determines whether to action the proposal or not.
The proposed plan has led to pushback from several community members on Sushi's governance platform, who showed concerns over Treasury's financial health and potential for voting power manipulation. Community members have suggested a fair distribution of revenues between treasury and operations to avoid disrupting operations and neglecting treasury. Accusations of a hostile takeover have also surfaced, with claims suggesting that the core developers created supplementary wallets before the vote to exaggerate their voting leverage.
In response, Sushi's 'Head Chef', Jared Grey discussed consultation with legal professionals and evading a potential hostile acquisition-he thus directed the operations team to execute a YAY vote with the operations wallet and all its assets. Grey believes that the Labs model could recover market share losses for Sushi. He expressed that several factors have delayed the current development roadmap products, some being the DAO's overambitiousness and self-inflicted budget constraints after snapshot votes when resources were far more plentiful for Sushi.
SushiSwap's income has notably reduced since 2022, despite current bullish market trends. As DefiLlama data highlights, the exchange generated $11.65 million in fees and $1.5 million in income in March 2023, lower than $3.5 million in fees and $531,640 income last month.
Published At
4/10/2024 8:45:48 PM
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