It’s another day in crypto governance experiments.
This time, Uniswap has taken center stage in a divisive new proposal to deploy the trading protocol on BNB Chain.
Specifically, commentators have raised concerns about the emergence of an influential whale in the project’s governance process.
That whale is venture capital fund Andreessen Horowitz, or a16z, which has deployed all 15 million of its UNI tokens to vote against the current proposal. UNI is Uniswap’s native token, which doubles as a governance token, letting users vote on key proposals.
This is not the first time a16z has found itself accused of being a centralized force in decentralized finance—despite its attempts to diversify its influence in the governance of DeFi protocols by delegating its voting power to various startups and universities.
The firm’s key contention that sparked its latest full-token vote appears less to be about the actual deployment on BNB Chain, however, and rather the means by which that deployment occurs.
The current proposal suggests using the Wormhole bridge, while a16z signaled in the temperature check phase of the governance that it would prefer to use LayerZero, a bridge protocol backed by the VC firm.
Wormhole is currently backed by another firm called Jump Crypto. It has yet to vote on the current proposal. Crypto bridges let users move non-native cryptocurrencies from one blockchain to another.
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Crypto Twitter split over governance vote
The hefty vote from a16z has nonetheless sparked debate around crypto Twitter.
Binance chief Changpeng “CZ” Zhao asked his audience of 8.1 million followers: “Uniswap controlled by a16z?”
Elsewhere, DeFi researcher Chris Blec said that “anti-competition cartels in DeFi are real,” in response to a16z’s massive vote. In another tweet, he said “a16z owns Uniswap protocol” and the firm “will decide on what future Uniswap versions look like.”
Others have taken a much different stance, though, with the co-founder of Tornado Cash Roman Semenov saying that he doesn’t “see anything wrong here” and that “this is how a free market is supposed to work.”
DegenSpartan tweeted that the VC firm’s massive vote is “not a bug by the way, a feature,” adding that “if you want more votes, buy more coins.”
Next steps for Uniswap vote
The vote is far from over, slated to end on February 10, and today the governance battle has transformed rather dramatically.
Though 15 million UNI tokens is a hefty sum, it represents roughly 2% of UNI’s current circulating supply and 1.5% of the total supply.
Thus, the extent of a16z’s control over Uniswap may have been overstated when its 15 million “no” votes were initially the majority of all votes cast.
In the past 24 hours, votes from a number of other whales—such as 5.76 million from Compound Labs’ Robert Lesher, 4.92 million from GFX Labs, and 3.5 million from Blockchain at Michigan—have counterbalanced a16z, with the proposal’s current tally at ~62% for and ~38% against.
So, does a16z really control Uniswap? Not quite.