A dramatic turn of events in Decentralized Finance (DeFi) space has seen recently. When the popular voting group, the “Golden Boys,” that voted to support a grievance identifiable proposal in Compound Finance has finally backed down and withdrawn the proposal. The motion which is officially known as Proposal 289, was only approved on July 28 but was met with criticism and backlash to the Steam community right after it. his occurred due to a vote that prompted the initiation of a new staking proposal, marking one of the most important episodes in Compound governance history.
Proposal 289 and Its Backlash
Golden Boys voting bloc, reportedly proposed Proposal 289 with the main goal to launch a wrapped “goldCOMP” token. While setting up a treasury based on the Compound’s governance token – COMP. To many this was perceived as an attempt at showcasing of power. Since the key was to be in the hands of a select few rather than shared among all. It goes against the platform policy of ‘open for all’.
Nonetheless, the proposal had a very low majority and was not accepted well by the Compound community. Some people said it was governance attack that negatively impacted the protocol and removed the representation of the public. Almost immediately, the community raised a hue and cry over the issue given the tendency that was seen with regards to the showcasing of power. As Vitalik Buterin, co-founder of Ethereum, aptly put it, “The main problem with centralized systems is that they are not resilient to governance failures.”
The Role of Humpy and the New Staking Proposal
Humpy has considered a key member of the Golden Boys and he played a critical role in the events took place. Realizing that the community is dissatisfied and this would create a long-term problem which may have a disastrous effect on Compound, Humpy entered into communications with other parties in an attempt to come to a resolution.
In an announcement on 29th July Humpy jointly announced that the Company had agreed to withdraw Proposal 289. However, the Golden Boys would back a new staking proposal to target the similar objectives that without the need for sacrificing the decentralization of the platform. This concerns the alternative proposal that is designed to initiate the more effective and inclusive form of the community governance.
Community Reaction and Future Development
Having seen this withdrawal of Proposal 289, there are different views and feeling that are being expressed. This has been welcomed by many members in the community as it takes this important social step towards maintaining the decentralize spirit of Compound. It indicates that decentralised governance is powerful and able to respond to Community’s feedback promptly.
However, some remain doubtful. People still worry about the reasons as for why this idea was first introduced and, possibly, if such efforts to unify power could be repeated in the future. In this episode, one has seen how there is always a tightrope in the development of DeFi to complement the existing ideas without losing their concepts.
The new staking proposal will now have to go through the normal criteria of a governance proposal across the community channels. Depending on the outcome, it may serve as a positive sign as to Compound’s future governance and its standing with the rest of DeFi fraternity. As Compound founder Robert Leshner once said, “Decentralized governance is not about removing humans from the decision-making process, but about creating a process that is transparent, accountable, and resistant to capture.”
A Lasting Impact: Lessons Learned from Proposal 289
The case of Proposal 289 and its withdrawal is an example that teaches decentralised governance is filled with many issues and problems. On the one hand, the Golden Boys’ decision to support a new staking proposal is a happy ending, though on the other hand, it indicates the further activity and permanent defense from new scammers and fake projects in DeFi.
This scenario will play out in the future as Compound Finance continues to evolve while the community tries to observe that the core ideals of decentralization and democracy are not forgotten. I’m sure this episode will remain one of the most profound ones as it reveals principles for the development of decentralised finance, particularly, openness, inclusiveness, and the ability to respond to individuals’ needs. Keep following Turkishnyradio for latest crypto updates and news.
