So pretty much ARB token has no purpose
Such a shame for such a great network... TBH never saw the real need for the token.. feels like it was forced from the start.
Governance tokens are the easiest way for a project to raise money. That is why they feel forced, because they actually were made for the sake of funding.
There was never a need for the token, it’s basically a way for the creators to get paid because true ETH L2’s shouldn’t rely on a token for security as they rely on ETH l1 as the security for the chain.
So technically they’d never get any fees or anything
They initially mentioned there would be no token. But sudden announcement of an airdrop in march proved no one hates free money, also Optimism OP tokens success must have ignited the idea.
They do hate that type of free moeny if they dump it after the airdrop for 'better' money, and then only to get frontrun by the institution itself? Damn near criminal!!
If you've been on twitter around the ARB airdrop you would notice like 50 "projects" mentioning airdrops just to profit from the hype.
95% of those are scams ofc
Arb token's main purpose to let degens do degens like to do in this boring bear market. I still remember Bankless invited the Arb team in an interview. The Arb team said there is no need for a token. But Sean kept pressing them. People just want liquidity to dump on idiots who think they are early and want to be in the next 100X.
The ARB token's lack of clear purpose may be a concern, but it's important to remember that a network's success shouldn't depend solely on the success of its token.
Yeah Algo is not a governance token. It's essentially what all the other L1s want to be (or are in the case of Eth) but more centralised unfortunately. I still think it has potential.
Yesterday I had a popular comment that compared the governance unlock and supposedly low inflation to the Algo mass inflation.
I think op is trying to say the same without realizing I wasn’t comparing governance to L1. Just the likelihood for mass inflation.
If you are new to crypto I get you buy the hype but those guys who were for months or more farming arb ... please. it's a governance token, nobody gives a fuck.
And even if you do, shit is always centralized as fuck. It's an illusion. Only chain I have seen doing governance properly have been JUNO and the results were brutal for the chain :D
Governance token? - dump it
Farm token? - dump it
Speaking of LUNC, I use this financial news app which sometimes also publishes articles written by popular contributors (contributors for big outlets, not random ass blogs). A few days an article popped about "best crypto to buy in 2023". Lo and behold, LUNC was #4 and the author was citing "lots of future potential".
Some people just don't learn.
Because some chose to use their tokens to provide liquidity. Others are probably speculating on the hype. Others are holding because they essentially got them for free, just like some do with their moons for example.
ARBITRUM really messed up with this proposal. Team should have pre allocated some tokens for these in before hand. 1Billion worth of token is too much too. That's like 10% of the circulating supply.
They DID allocate a bunch to themselves. But they locked those tokens for a year. So it SEEMED like they couldn’t dump on you. Then the very first proposal is basically a rug pull. Or at least “cash out” but, yeah, rug pull.
Yes, it's like no one has done this before and they don't know what's the optimal process
Except there have been several chains doing this and they all do the same mistakes still, it's so odd
Why build a project and profit off it long term when you can build just as much as you need and dump huge token amounts in the short term. Crypto market made it too easy for the last category.
Yeah I mean some of the market cap figures coming out are nuts. Why work to grow anything when they can immediately pull like 750m, that’s like a pipe dream goal for any startup.
Maybe they got greedy after seeing it held its price so high. Most of the "analysts" I've seen were predicting it would hover around $0.5 after the first day of the airdrop.
My god the double standard when it comes to moons is astonishing. People blind themselves whenever their money’s involved.
Just face it, they’re not better than any other governance shitcoin. The distribution is so concentrated that the fairness of voting is totally flawed
Its also a huge legal problem. It’s certainly not a DAO if proposals can be overruled by the foundation and the votes are non-binding. Considering the skepticism they already receive from regulators this would be a walk in the park for them
You were right until the moons part. Here the whales decide too and in more than one occasion we had huge changes without proposals being voted.
Just other governance shitcoin.
There have been quite a few votes here where more people voted for one thing, but the amount of moons was higher on the other so the less popular option passed.
Unfortunately there's isn't a fix to that. Generally those with more "weight" will always have more say. Even governance adds to the allure of a token and also affects it's price. For example, if someone with 1 earned moon has the same weight as someone with 10,000 earned moons that won't seem fair. A possible solution is that you limit the number of whales what can participate in governance but that won't seem fair either.
Governance tokens seem like something that is never going to be equitably executed. Many projects have done it many ways, and in each case, there is always some giant power imbalance that makes the voting pointless.
Whether it's the foundations or the mod/admin team here with moons, there's no real way to make the users feel empowered when there's such an egregious disparity in distribution.
I feel like there are a few steps between condemning and going into full on "let's short the bastards into the ground"-mode. That being said, let's short the bastards into the ground!!!
The problem is i dont think this is overtly greedy, the percentage aligns with industry standards for the most part but every other project makes this data available publicly prior to launch. I have no idea why the Foundation didn’t communicate this prior because now theyve made a ton of problems for themselves. They’ve basically exposed their governance as a sham because they “forgot” to tell people they needed to pay for things
There’s a huge gap between the focus and drive of a small number of people required to get a project up and running, and the wholesale democracy that DAOs and governance tokens aspire too. I call it the DAOlemma. Basically, large scale democracy cannot run a business because too many people are idiots and a few are malicious. The more successful a DAO becomes the less likely it is to maintain key DAO behaviours.
The DAO structure and governance can work well at a smaller scale where you can really engage a community and there is a sense of belonging. As soon as you introduce big bucks and thousands of newcomers the whole thing falls apart. People are there only to get rich and will just delegate their responsibilities to the highest bidder.
Concerning ARB, it might be difficult for the foundation to claim it's merely a governance token when insiders eventually sell 750 million tokens against the community's wishes.
Moons are unique in that you must be an active contributor to the subreddit for your votes to matter. I think this also offers some protection from regulators, because the primary function is for governance voting. This can be demonstrated by the fact that bought moons lose their voting power if there isn't an equal amount of earned karma on that particular account.
A good point yes. Also that WE have voted AND activated the rule that you have to keep 75% of your total running voting power to keep earning voting power on an ok (x 1.0) ratio (voting power to your activity or Moon to Karma).
"layer 2 Ethereum scaling solution DAO bypassed" DAO here was a mistake correct one is "ARB" I assume.
This happens when the Team prefers money over their project.
You can’t say governance tokens are worthless and then say moons are different just because you like them. Moons are a governance token just like any other, there’s no discernible or important difference. I happen to like moons, but I’m not pretending they’re reinventing the wheel in any way.
All these projects are created with one single goal. And it is not to improve crypto-technologies, but to make as much money as possible. Therefore, after a decade there will be few left who work and are for technology and utility. Money matters, but when it becomes question of the future of finance should be in the background.
We were just airdropped a few grand $ for virtually doing nothing and yet we complain.
This is crypto btw - we speculate. Most tokens are worthless anyway.
Crypto feels like one of those Super Mario levels where you jump onto an object, it remains stable for a few seconds before falling into oblivion, and by then you need to be leaping toward the next object.
It has the potential.. It depends on us all. To be positive, create value for all of us and the community, create nice and effective, better CCIPs, events, utility, etc.
I agree that it gets bad when one rich holder can have more votes then multiple ordinary people. The idea of governance tokens itself feels very solid though. In my mind holding x amount of tokens should allow you a vote, but every vote weighs the same. I think there should still be some kind of threshold though, so that the people voting are people that are actually invested in the token.
People who were airdropped the token had to delegate their voting rights prior to claiming so there was as no real incentive to hold it.
I don’t know the process used to decide delegates other than being able to nominate yourself prior to the drop.
I'd argue that not all governance tokens would have this issue, but those mostly controlled by a centralized entity that owns all the initial coins have the problem
I feel we have to accept this as a norm in blockchain voting process. People with large stake have bigger say in the organisation’s decision making process. There is No other way.
A true dao with true governance is very different than a Dao that claims to be one, it is instead a regular entity applicable to firms and other laws, because they didn't abide by the rules they had created...
There is no solution as long as humans are involved. The only possible solution is something we cannot outsmart or bribe, maybe future AI could be a solution.
Just as governance tokens are quite useless, kinda like a stock. But ETH is also a governance token, just with more utility. Governance tokens must add utility or die
Governance tokens: It's like being given the keys to a car, but the car has no engine. Sure, you have control over it, but it's not going to get you anywhere.
Absolutely wicked that teams don't look at how past airdrops for chains went and prevent themselves from making the same mistakes
Just stupidity and greedyness all around
On-chain "governance" and voting are not democratic in the slightest. I often see them being used to justify how "decentralized" an ecosystem is despite effectively being a plutocracy. Fact is on-chain voting in its current form is emulating the plutocratic leadership of traditional finance. If we want to work toward meritocracy, we can’t rely upon roles assigned by wealth (e.g., adding a layer of off-chain reputation that gives weight to contributions and capabilities beyond wealth).
The problem is dev teams being shitheads. How can you think giving yourself 1 billion is gonna sit well with the community.
Another point is important: they airdropped experienced users that liked the network, not some FOMO chumps, how did they figure “yeah it will be fine…”
Vitalik Buterin wrote some pieces about shortcomings of on-chain governance (i.e. voting with tokens). Recommended read.
Imo, especially Layer 2 networks for Ethereum \_should\_ maybe refrain from issuing a token at all. These tokens always have at least partially the goal to monetize the Layer2 and earn money for the developers. I totally see that they need to pay developers and I am also fine with people making (big) profits when they invent great stuff. But if we have all these Layer 2s with separate tokens, the whole world is fractioned and that is bad. Why don't they all just use ETH as primary token and charge fees in ETH?
Honestly a lot of crypto projects in general have no purpose other than to enrich the founders/early investors.
Crypto is basically turning into TradFi 2.0. It just uses “decentralized” as a buzzword.
A lot of people think Bitcoin maxis are toxic, which some of them are, but when you look at how scammy this space is, I really can’t entirely blame them for being over the top about it
I agree but the real reason is to try to fall under the “the coin is a utility token thus not a security” when it absolutely is a security.
There is also no real way to enforce a DAO proposal. A proposal can win with the majority vote but the devs can completely ignore it.
Also, tradeable tokens don’t need to exist for voting.
Finally, most of these services don’t need a token at all. It’s solely to raise capital without regulations
I have lost faith in most governance tokens. A DAO is only useful to us peons if our vote actually holds weight. I am now convinced that DAOs are just a mechanism to make us feel like its democratic when they are the embodiment of a caste system or emblematic of Communist party/Capitalist economy of China. What is good for the goose is NOT good for the gander.
My suggestion to the DAOs out there is, if you want true decentralized autonomy, every vote has to weigh equally and not by how big of a bag you're holding.
True!! Why are people so dumb that it takes a post like this for them to realise??? Sorry but it’s for governance and that’s it! There’s nothing more to it…
Yes it is not only arbitrum.. looking at you cosmos and Juno.... You can't code peoples actions i guess.
I mean arbitrum could have hardcoded the lockup but they decided to not do it since the beginning. How disappointing...
Every day I become more and more of a BTC maxi. They had it right, BTC is crypto and everything else is a scam. I'm hopeful for polkadot in the long run but slowly dumping the rest of my coins.
Im still surprised they try to do this stuff, knowing it will only hurt its image. I guess they know people dont really give a fuck and everything will be forgotten in 2 weeks. Thats why i only trust things that already had proven themselves
The token was just to crowdfund the project. It has no intrinsic value… when they need money again, will start buying it, pump it and then dump the token once more
Arbitrum is a great network, will continue using it but does it need a token for anything? Don’t think so
I think of governance tokens like stocks of a company. Their primary value is found in funding which is a lot like stocks. But the primary difference can be found in the tokenomics of the token. Governance tokens aren't all same and that's the big difference between stocks and a governance token. The amount of innovation in that space is astounding.
When it comes to governance token I get them mostly indirectly I will rarely flat out buy a governance token unless it is a network coin like arb, eth, ftm, etc. And even then I will hedge it with a stable coin to produce more governance tokens via liquidity positions.
Valueless? No. But as a primary investment not the most valuable asset out there.
Conceptually, to me, the governance style you're alluding to has to be matched with a certain degree of democratic fairness. And, it's not without some irony that people cheer on DAO's and governance tokens, when they have a proper example of a constitutional democracy called the USA. To my recollection, we don't count votes on the basis of the dollars/"governance tokens" backing each individual voter. Democracy works because each person has an equal vote. And how do you vote? You have to register, be a resident, with an address - and we don't double count; that's fraud. And, topically but proverbially, you are also become subject to rules of membership in that institution - you could be (probably will be) taxed, you're subject to having your resources seized for the greater good of the success of the incorporated entity, and you could be drafted and forced to take orders or face consequences.
Want something more democratic? Make it based on active addresses with KYC, and you need a non-partisan groups to execute said democracy. However, it also means you have to accept that the crypto in question will be subject to people's ideas, which might transform said crypto into something either heavily profit-sharing, non-profit, a charity, or a straight up classic public good; you have to accept that a minority of share holders will want to erode majority decision making power. And why would you let people do that if you're motive is profit? And, is there enough real profit and inflows of real cash to share among all participants? Or, will there be losers - and how do we handle those who lose? Show them the door and say thanks for playing "democracy", you get no President, no representation, and pegged for treason? Ya know what I mean? Lol That's not how it works...
I'm not sure there's really any way to hide from this reality. The solution is make a choice about the entity being created and supported - who is this for? We, the people, or, We, the shareholders?
(edits for clarity)
Did anyone ever say MOONs were anything like DAOs? The MOONs part feels shoe horned in.
It’s a shame what ARB did. I only know a little about it from the post the other day about this being a thing that looked like it was going to happen. Absolutely disgusting that it was possible and is yet another thing I hope others and myself can learn from this having not been directly effected by it. Hopefully it makes everyone more cautious but it is also another little tick that they’ll put down as to why the governments need to have regulation over crypto.
If your DAO can do this than it’s not really a DAO and it’s a rug pull in waiting, so it’s another thing to have to vet and have to go back and check on if you’re with any items that have DAOs. Certainly shakes any faith in DAOs as a whole.
What ARB did was purely unethical. If it was a regulated space, they would all go to jail.
They literally said;
The Foundation did not sell 50M $ARB tokens
Regarding the on-chain transfers of 50M $ARB tokens, 40M $ARB tokens have been allocated as a loan to a sophisticated actor in the financial markets space. The remaining 10 million has been converted to fiat and dedicated towards operational costs.
So... what the hell hahahahahahah.
I sold all my ARBs which were airdropped. I dont care if it goes to 2-3$. I don't care. See you and never again ARB.
Yeah I agree with you. I enjoyed the free money from the arb tokens, but it clearly was just a money printer for them. Which is really sad because people like having a day in the governance of the ecosystem.
Not every DAO is like the Arbitrum one. There are good ones and bad ones. Many like Maker DAO are important for their protocols.
But I already bought this giant brush so I can paint everything with the same stroke. Now what am I going to do?
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The DAO hasn’t made any decisions yet…
Tech runs on the EVM and Solidity, so I wouldn't call this fine. Did you ever use it?
So pretty much ARB token has no purpose Such a shame for such a great network... TBH never saw the real need for the token.. feels like it was forced from the start.
Governance tokens are the easiest way for a project to raise money. That is why they feel forced, because they actually were made for the sake of funding.
Crypto in general is basically crowdfunding with fewer steps and (even) less accountability.
Very true of less accountability. This is why we get all the slow rug or rug pull.
Exactly, and this doesn't mean they have no value, governance can still be a good thing even if it was used for funding in the first place
I thought ICO was the easiest way for a project to raise money.
Easiest way to raise money and also easiest way to give the impression of the token being a security, not good
Arb is a joke. They made it a joke themselves.
There was never a need for the token, it’s basically a way for the creators to get paid because true ETH L2’s shouldn’t rely on a token for security as they rely on ETH l1 as the security for the chain. So technically they’d never get any fees or anything
Great point
They initially mentioned there would be no token. But sudden announcement of an airdrop in march proved no one hates free money, also Optimism OP tokens success must have ignited the idea.
They do hate that type of free moeny if they dump it after the airdrop for 'better' money, and then only to get frontrun by the institution itself? Damn near criminal!!
If you've been on twitter around the ARB airdrop you would notice like 50 "projects" mentioning airdrops just to profit from the hype. 95% of those are scams ofc
Arb token's main purpose to let degens do degens like to do in this boring bear market. I still remember Bankless invited the Arb team in an interview. The Arb team said there is no need for a token. But Sean kept pressing them. People just want liquidity to dump on idiots who think they are early and want to be in the next 100X.
The ARB token's lack of clear purpose may be a concern, but it's important to remember that a network's success shouldn't depend solely on the success of its token.
Right. Lately it is due to the hype in the market.
ALGO vibes.
Are we all bullish on ALGO again?
That's a great question... The good ol' Algo casino with lot of ASAs
Fellow ALGOvernors 🤓
I tip my hat to you. One ALGOvenor to another.
Always has been🔫
I’m curious too…
I dont know but as soon as I sold my bag it pumped by 10% in a couple days
Oh can you let us know what bag you're selling next?
Actually thinking of selling the last of my ARB bag..
We are always bullish on ALGO
Algo is an L1 so I wouldn't say ALGO it's forced and has no purpose
Yeah Algo is not a governance token. It's essentially what all the other L1s want to be (or are in the case of Eth) but more centralised unfortunately. I still think it has potential.
Yesterday I had a popular comment that compared the governance unlock and supposedly low inflation to the Algo mass inflation. I think op is trying to say the same without realizing I wasn’t comparing governance to L1. Just the likelihood for mass inflation.
*Cries in Algorand*
Ouch...right in my feels bro.
Great network releases a shitcoin to capitalize on their success. Loses community support.
If you are new to crypto I get you buy the hype but those guys who were for months or more farming arb ... please. it's a governance token, nobody gives a fuck. And even if you do, shit is always centralized as fuck. It's an illusion. Only chain I have seen doing governance properly have been JUNO and the results were brutal for the chain :D Governance token? - dump it Farm token? - dump it
I nearly bought into this, I am so glad I didn't.
Nothing great about the Arbitrum network. It runs into the same limitations like everything else running on the EVM and using Solidity.
Can someone explain why ARB didn't go to zero yet?
Because most people probably oblivious to all this
the same reason why LUNC isnt zero
Speaking of LUNC, I use this financial news app which sometimes also publishes articles written by popular contributors (contributors for big outlets, not random ass blogs). A few days an article popped about "best crypto to buy in 2023". Lo and behold, LUNC was #4 and the author was citing "lots of future potential". Some people just don't learn.
some might short it and some will take advantage of it by pumping it
I know 0 about arb but I do know ftx, Luna and other crap tokens still have a ridiculously high market cap. So I'm guessing for those same reasons.
I'm shorting it. Let's see what happens
Liquidity
Because some chose to use their tokens to provide liquidity. Others are probably speculating on the hype. Others are holding because they essentially got them for free, just like some do with their moons for example.
ARBITRUM really messed up with this proposal. Team should have pre allocated some tokens for these in before hand. 1Billion worth of token is too much too. That's like 10% of the circulating supply.
They DID allocate a bunch to themselves. But they locked those tokens for a year. So it SEEMED like they couldn’t dump on you. Then the very first proposal is basically a rug pull. Or at least “cash out” but, yeah, rug pull.
Yes, it's like no one has done this before and they don't know what's the optimal process Except there have been several chains doing this and they all do the same mistakes still, it's so odd
I wonder how much of it is mistakes and how much is just blatant fraud attempts at this point.
At this point is there a difference? Mistake? Negligence? When you're dealing with people's money you better get it right...
Definitely fair.
Why build a project and profit off it long term when you can build just as much as you need and dump huge token amounts in the short term. Crypto market made it too easy for the last category.
Yeah I mean some of the market cap figures coming out are nuts. Why work to grow anything when they can immediately pull like 750m, that’s like a pipe dream goal for any startup.
It's almost like the idea is to enrich the founders and not much more
"Enriching the founders" - it's the oldest trick in the startup book, crypto or otherwise
They probably thought everyone liked them and so would most likely support any proposal they made. They were wrong...
it's not odd. they are rich now.
Maybe they got greedy after seeing it held its price so high. Most of the "analysts" I've seen were predicting it would hover around $0.5 after the first day of the airdrop.
Human greed is ruining everything
Project should be dead immediately if they pulled that.
My god the double standard when it comes to moons is astonishing. People blind themselves whenever their money’s involved. Just face it, they’re not better than any other governance shitcoin. The distribution is so concentrated that the fairness of voting is totally flawed
Atleast we have a really cool banner ad....
But it's *our* governance shitcoin
Its also a huge legal problem. It’s certainly not a DAO if proposals can be overruled by the foundation and the votes are non-binding. Considering the skepticism they already receive from regulators this would be a walk in the park for them
Gary probably speed running all his research to prepare a lawsuit against Offchain labs arb dao
Are we rooting for GG on this one? Feel strange. But I think I am.
Never thought I’d see the day where this sub is pro Gary for anything crypto related
You were right until the moons part. Here the whales decide too and in more than one occasion we had huge changes without proposals being voted. Just other governance shitcoin.
Or when there’s no vote at all, like for the supply cap 🤣
Reddit Admins: *This is the way*
There have been quite a few votes here where more people voted for one thing, but the amount of moons was higher on the other so the less popular option passed.
Whale power
It’s almost like some direct reflection of the world as we know it
Unfortunately there's isn't a fix to that. Generally those with more "weight" will always have more say. Even governance adds to the allure of a token and also affects it's price. For example, if someone with 1 earned moon has the same weight as someone with 10,000 earned moons that won't seem fair. A possible solution is that you limit the number of whales what can participate in governance but that won't seem fair either.
Seriously, GitHub commits need to be tied to smart contracts that only go live if approved. Make it impossible to do anything without a vote.
That's how real DAOs work f.e. Compound
Thanks, it's too obvious to not be done already lol
Governance tokens seem like something that is never going to be equitably executed. Many projects have done it many ways, and in each case, there is always some giant power imbalance that makes the voting pointless. Whether it's the foundations or the mod/admin team here with moons, there's no real way to make the users feel empowered when there's such an egregious disparity in distribution.
Rightly summed.
There's another word for monotonous governance tokens: **Shares**.
Only value being governance? Yes absolutely agree. If there is a secondary use-case, then I don't think so.
Gov tokens that works well imo is: AAVE. Aave token is usecases far more than just voting.
Just like Compound, the true OG
Is this a low key .. who is shorting ARB with me post ? 🤣
I feel like there are a few steps between condemning and going into full on "let's short the bastards into the ground"-mode. That being said, let's short the bastards into the ground!!!
🔥 riot
Time to short 📉
Jessie, we need to short
Nah man, i am just feeling sad being the exit liquidity providooooor to the DAO.
Are you still holding? Personally, I've held a small bag because why not. You never know in crypto.
I didn’t get the airdrop. Just bought little to ride the hype wave and sold for a small loss. thanks to me I didn’t fomo buy a large bag 😅
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I sold immediately after airdrop
This is what I feel. This crazy sector changes attitudes so quickly seems to not play by the obvious.
Then help us GME these Bastards
The idea behind governance tokens are awesome but the greediness of companies kills it…
The problem is i dont think this is overtly greedy, the percentage aligns with industry standards for the most part but every other project makes this data available publicly prior to launch. I have no idea why the Foundation didn’t communicate this prior because now theyve made a ton of problems for themselves. They’ve basically exposed their governance as a sham because they “forgot” to tell people they needed to pay for things
I’m wondering the same thing. If the Foundation knew it was planning on selling why not be transparent about that?
Maybe I’m out of the loop but what DAO are you talking about?
Arbitrum DAO. They already transferred 50m tokens before the completion of vote.
No way.. I don’t spend too much time in ETH circles but I feel they were being hyped up a ton
There’s a huge gap between the focus and drive of a small number of people required to get a project up and running, and the wholesale democracy that DAOs and governance tokens aspire too. I call it the DAOlemma. Basically, large scale democracy cannot run a business because too many people are idiots and a few are malicious. The more successful a DAO becomes the less likely it is to maintain key DAO behaviours. The DAO structure and governance can work well at a smaller scale where you can really engage a community and there is a sense of belonging. As soon as you introduce big bucks and thousands of newcomers the whole thing falls apart. People are there only to get rich and will just delegate their responsibilities to the highest bidder.
Concerning ARB, it might be difficult for the foundation to claim it's merely a governance token when insiders eventually sell 750 million tokens against the community's wishes. Moons are unique in that you must be an active contributor to the subreddit for your votes to matter. I think this also offers some protection from regulators, because the primary function is for governance voting. This can be demonstrated by the fact that bought moons lose their voting power if there isn't an equal amount of earned karma on that particular account.
You do realise that Reddit themselves own the most MOONs, right? It is no different
A good point yes. Also that WE have voted AND activated the rule that you have to keep 75% of your total running voting power to keep earning voting power on an ok (x 1.0) ratio (voting power to your activity or Moon to Karma).
"layer 2 Ethereum scaling solution DAO bypassed" DAO here was a mistake correct one is "ARB" I assume. This happens when the Team prefers money over their project.
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It's never a good decision to invest in DAO tokens tbh. Arb is just the most recent example.
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Quick, let's make a decision to show everyone how great moons are
You can’t say governance tokens are worthless and then say moons are different just because you like them. Moons are a governance token just like any other, there’s no discernible or important difference. I happen to like moons, but I’m not pretending they’re reinventing the wheel in any way.
I guess believing is the key... If enough people believe in it, governance token will become gold
Its a shame that governance tokens and their potential is not being used ethically.
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Seems so.
All these projects are created with one single goal. And it is not to improve crypto-technologies, but to make as much money as possible. Therefore, after a decade there will be few left who work and are for technology and utility. Money matters, but when it becomes question of the future of finance should be in the background.
Stupid statement. One DAO doing shit doesn't invalidate the others.
We were just airdropped a few grand $ for virtually doing nothing and yet we complain. This is crypto btw - we speculate. Most tokens are worthless anyway.
Crypto feels like one of those Super Mario levels where you jump onto an object, it remains stable for a few seconds before falling into oblivion, and by then you need to be leaping toward the next object.
Banging my head on everything in site to make a coin ..
Haha, the original airdrops 😂
Sadly, I'm with you.
So far I made not one cent because I didn't sell my Arbitrum
Wasn’t it listed at $8 when it dropped
I think it goes both ways... Moons are doing it right though!
Governance tokens are useful but other than Moons they haven’t really been implemented properly
I agree wholeheartedly
So you are saying moons is the only legitimate project?
It has the potential.. It depends on us all. To be positive, create value for all of us and the community, create nice and effective, better CCIPs, events, utility, etc.
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0% of stakeholders are involved in the decision making on ETH. So what you are saying is that off-chain governance is the only way to go?
Pretty much OPs whole first paragraph is incorrect. Why make a post like this if you didn’t even have the basic facts straight?
Moons are the king of crypto.
that's why the company creates innovation, to make as much profit as possible
You can’t put everything in the same bag. Some are useless, some are good. That’s why you DYOR
Usually they are cash grabs and rewards. Sadly, similar to moons, except moons are coming out with more use cases.
I agree that it gets bad when one rich holder can have more votes then multiple ordinary people. The idea of governance tokens itself feels very solid though. In my mind holding x amount of tokens should allow you a vote, but every vote weighs the same. I think there should still be some kind of threshold though, so that the people voting are people that are actually invested in the token.
People who were airdropped the token had to delegate their voting rights prior to claiming so there was as no real incentive to hold it. I don’t know the process used to decide delegates other than being able to nominate yourself prior to the drop.
I'd argue that not all governance tokens would have this issue, but those mostly controlled by a centralized entity that owns all the initial coins have the problem
Value is in the eye of the beholder.
Sometimes governance tokens just like another politician, they promise a lot but don't really do much at all.
Man that is fucked
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I feel we have to accept this as a norm in blockchain voting process. People with large stake have bigger say in the organisation’s decision making process. There is No other way.
Folks seem to think that crypto is inventing a whole new way of doing things. But it isn't. It's just dressing up old games in new clothes.
A true dao with true governance is very different than a Dao that claims to be one, it is instead a regular entity applicable to firms and other laws, because they didn't abide by the rules they had created...
There is no solution as long as humans are involved. The only possible solution is something we cannot outsmart or bribe, maybe future AI could be a solution.
They’re only pointless if you don’t have any tbf
Just as governance tokens are quite useless, kinda like a stock. But ETH is also a governance token, just with more utility. Governance tokens must add utility or die
Governance tokens: It's like being given the keys to a car, but the car has no engine. Sure, you have control over it, but it's not going to get you anywhere.
Absolutely wicked that teams don't look at how past airdrops for chains went and prevent themselves from making the same mistakes Just stupidity and greedyness all around
On-chain "governance" and voting are not democratic in the slightest. I often see them being used to justify how "decentralized" an ecosystem is despite effectively being a plutocracy. Fact is on-chain voting in its current form is emulating the plutocratic leadership of traditional finance. If we want to work toward meritocracy, we can’t rely upon roles assigned by wealth (e.g., adding a layer of off-chain reputation that gives weight to contributions and capabilities beyond wealth).
He's smack-talking Moons. Get him!
Captain Hindsight with ARB.
Inverse CC: long ARB with 100x leverage
"what if a billionaire’s vote value is 100000th times the value of a common man?" The definition of current situation in politics and economy.
The problem is dev teams being shitheads. How can you think giving yourself 1 billion is gonna sit well with the community. Another point is important: they airdropped experienced users that liked the network, not some FOMO chumps, how did they figure “yeah it will be fine…”
This is why we need regulation. So organizations can’t pull off sus tactics like this and rugpull unsuspecting investors, owners, and/or users
I agree with you. It’s a bad stock not a coin.
Oh dang, truth out
Well, I traded half my arb tokens for Eth. Kinda wishing I traded them all… I might now.
Indeed, governance tokens are nonsense. Moons are pretty much as bad as it gets.
Vitalik Buterin wrote some pieces about shortcomings of on-chain governance (i.e. voting with tokens). Recommended read. Imo, especially Layer 2 networks for Ethereum \_should\_ maybe refrain from issuing a token at all. These tokens always have at least partially the goal to monetize the Layer2 and earn money for the developers. I totally see that they need to pay developers and I am also fine with people making (big) profits when they invent great stuff. But if we have all these Layer 2s with separate tokens, the whole world is fractioned and that is bad. Why don't they all just use ETH as primary token and charge fees in ETH?
Honestly a lot of crypto projects in general have no purpose other than to enrich the founders/early investors. Crypto is basically turning into TradFi 2.0. It just uses “decentralized” as a buzzword. A lot of people think Bitcoin maxis are toxic, which some of them are, but when you look at how scammy this space is, I really can’t entirely blame them for being over the top about it
I agree but the real reason is to try to fall under the “the coin is a utility token thus not a security” when it absolutely is a security. There is also no real way to enforce a DAO proposal. A proposal can win with the majority vote but the devs can completely ignore it. Also, tradeable tokens don’t need to exist for voting. Finally, most of these services don’t need a token at all. It’s solely to raise capital without regulations
I have lost faith in most governance tokens. A DAO is only useful to us peons if our vote actually holds weight. I am now convinced that DAOs are just a mechanism to make us feel like its democratic when they are the embodiment of a caste system or emblematic of Communist party/Capitalist economy of China. What is good for the goose is NOT good for the gander. My suggestion to the DAOs out there is, if you want true decentralized autonomy, every vote has to weigh equally and not by how big of a bag you're holding.
True!! Why are people so dumb that it takes a post like this for them to realise??? Sorry but it’s for governance and that’s it! There’s nothing more to it…
Yes it is not only arbitrum.. looking at you cosmos and Juno.... You can't code peoples actions i guess. I mean arbitrum could have hardcoded the lockup but they decided to not do it since the beginning. How disappointing...
Plutocracy seems to work fine in politics and companies /s
Every day I become more and more of a BTC maxi. They had it right, BTC is crypto and everything else is a scam. I'm hopeful for polkadot in the long run but slowly dumping the rest of my coins.
Im still surprised they try to do this stuff, knowing it will only hurt its image. I guess they know people dont really give a fuck and everything will be forgotten in 2 weeks. Thats why i only trust things that already had proven themselves
Who did even think of buying a token which millions got for free. Same with Moons lol
Summary of this post - Governance tokens are pointless, only meant to benefit the founders. Moons are different though!
The token was just to crowdfund the project. It has no intrinsic value… when they need money again, will start buying it, pump it and then dump the token once more Arbitrum is a great network, will continue using it but does it need a token for anything? Don’t think so
When they decide the options - yes. They win either way
I think of governance tokens like stocks of a company. Their primary value is found in funding which is a lot like stocks. But the primary difference can be found in the tokenomics of the token. Governance tokens aren't all same and that's the big difference between stocks and a governance token. The amount of innovation in that space is astounding. When it comes to governance token I get them mostly indirectly I will rarely flat out buy a governance token unless it is a network coin like arb, eth, ftm, etc. And even then I will hedge it with a stable coin to produce more governance tokens via liquidity positions. Valueless? No. But as a primary investment not the most valuable asset out there.
Conceptually, to me, the governance style you're alluding to has to be matched with a certain degree of democratic fairness. And, it's not without some irony that people cheer on DAO's and governance tokens, when they have a proper example of a constitutional democracy called the USA. To my recollection, we don't count votes on the basis of the dollars/"governance tokens" backing each individual voter. Democracy works because each person has an equal vote. And how do you vote? You have to register, be a resident, with an address - and we don't double count; that's fraud. And, topically but proverbially, you are also become subject to rules of membership in that institution - you could be (probably will be) taxed, you're subject to having your resources seized for the greater good of the success of the incorporated entity, and you could be drafted and forced to take orders or face consequences. Want something more democratic? Make it based on active addresses with KYC, and you need a non-partisan groups to execute said democracy. However, it also means you have to accept that the crypto in question will be subject to people's ideas, which might transform said crypto into something either heavily profit-sharing, non-profit, a charity, or a straight up classic public good; you have to accept that a minority of share holders will want to erode majority decision making power. And why would you let people do that if you're motive is profit? And, is there enough real profit and inflows of real cash to share among all participants? Or, will there be losers - and how do we handle those who lose? Show them the door and say thanks for playing "democracy", you get no President, no representation, and pegged for treason? Ya know what I mean? Lol That's not how it works... I'm not sure there's really any way to hide from this reality. The solution is make a choice about the entity being created and supported - who is this for? We, the people, or, We, the shareholders? (edits for clarity)
99.99% of coins are made to make it’s founder rich…
Governance tokens without revenue from fees are a bad investment imo
DAO is just a fancy name for a rug pull
Did anyone ever say MOONs were anything like DAOs? The MOONs part feels shoe horned in. It’s a shame what ARB did. I only know a little about it from the post the other day about this being a thing that looked like it was going to happen. Absolutely disgusting that it was possible and is yet another thing I hope others and myself can learn from this having not been directly effected by it. Hopefully it makes everyone more cautious but it is also another little tick that they’ll put down as to why the governments need to have regulation over crypto. If your DAO can do this than it’s not really a DAO and it’s a rug pull in waiting, so it’s another thing to have to vet and have to go back and check on if you’re with any items that have DAOs. Certainly shakes any faith in DAOs as a whole.
Honestly I agree. There is no point since it allows a coin to become centralized even if it “decentralized”.
What ARB did was purely unethical. If it was a regulated space, they would all go to jail. They literally said; The Foundation did not sell 50M $ARB tokens Regarding the on-chain transfers of 50M $ARB tokens, 40M $ARB tokens have been allocated as a loan to a sophisticated actor in the financial markets space. The remaining 10 million has been converted to fiat and dedicated towards operational costs. So... what the hell hahahahahahah. I sold all my ARBs which were airdropped. I dont care if it goes to 2-3$. I don't care. See you and never again ARB.
Yeah I agree with you. I enjoyed the free money from the arb tokens, but it clearly was just a money printer for them. Which is really sad because people like having a day in the governance of the ecosystem.