The Ethereum-based exchange aggregator 1inch is considering a change to their governance system, providing voting power to the broader community of token holders. Jordan Reindl, a member of 1inch’s community and governance team, announced a proposal on Friday to dilute the voting power of insiders who have received all of their v1inch vesting tokens, a derivative token redeemable for 1inch, by treating the tokens like st1inch for voting purposes. This decision would give general community members increased influence in governance proposals. The proposal has not been voted on yet.

The v1inch vesting tokens system provides investors an extended period of time to obtain their tokens, as they receive them in several installments. If the tokens remain locked up for two years or longer, they will gain 100% of their voting weight. Meanwhile, insiders who have already received all of their tokens would lose voting power, with the intention of increasing the role of the broader community. This idea has been initiated due to the “disproportionately large amount of voting power” contained within the v1inch token contract for investors with vested tokens.

Reindl stated that the proposed amendment to 1inch’s governance system is a step in the right direction. Dilution in terms of voting power could help the protocol become more decentralized, and could ensure the rights of those who have invested their time and resources into the exchange. Although v1inch holders will have decreased voting rights, the proposal intends to reach a beneficial outcome for token holders, via increased community decisions and a realignment of the protocol’s power dynamic.

1inch’s governance token is currently experiencing a 1.96% decrease in value and is trading at 56 cents at press time. It is still unclear when the community members will vote on the proposed amendment and what effect, if any, the vote will have on the price and the acceptance of the protocol’s governance system. At present, it remains to be seen whether the change will be accepted, and the broader community of token holders will become the main decision makers.



Other News from Today