{"id":89704,"date":"2020-10-15T12:33:00","date_gmt":"2020-10-15T09:33:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14\/"},"modified":"2020-10-15T12:33:00","modified_gmt":"2020-10-15T09:33:00","slug":"finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14\/","title":{"rendered":"# Finance Redefined: Can DeFi and on-chain governance change human nature? Oct. 7-14"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3e1686e9944\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3e1686e9944\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14\/#The_rich_get_richer\" >The rich get richer<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14\/#The_blame_games_are_getting_out_of_hand\" >The blame games are getting out of hand<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Finance Redefined: Can DeFi and on-chain governance change human nature? Oct. 7-14 <\/strong>&#8221;<\/p>\n<div data-v-5a136f3a=\"\">\n<p dir=\"ltr\" id=\"docs-internal-guid-5f2d31d7-7fff-5783-0d5c-a87a6f12e1b5\">This week, one bit of <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a> really grabbed my attention: Dharma getting criticized for allegedly trying to capture Uniswap governance.<\/p>\n<p>Dharma is the company behind a crypto payments and exchange <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>, a sort of Ethereum-based cousin of Square\u2019s Cash App. Or at least that\u2019s what I previously used to describe it \u2014 if you visit the website now you basically only see mentions of DeFi and some very <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/trip-and-travel\/\" data-internallinksmanager029f6b8e52c=\"10\" title=\"Trip &amp; Travel\" target=\"_blank\" rel=\"noopener\">trip<\/a>py images.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" width=\"814\" height=\"768\" alt=\"The Dharma website design is now very\u2026 daring. And inspired by Uniswap in some ways.\" src=\"https:\/\/s3.cointelegraph.com\/storage\/uploads\/view\/13cf4ecea1c81cf6fd8fd0293fc856ad.jpg\" title=\"The Dharma website design is now very\u2026 daring. And inspired by Uniswap in some ways.\"\/><\/p>\n<p dir=\"ltr\" style=\"text-align: center;\"><em>The Dharma website design is now very\u2026 daring. And inspired by Uniswap in some ways.<\/em><\/p>\n<p>Like Uniswap and Compound, Dharma is backed by some traditional Silicon Valley venture capitalists and Coinbase. It\u2019s also one of the most vocal \u201ccommunity governance\u201d members of both protocols \u2014 shocking, I know.<\/p>\n<p>But I don\u2019t mean to single out Dharma here. They have legitimate interests in the matter given their tight product integrations with DeFi, and on Uniswap they\u2019re <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/gov.uniswap.org\/t\/retroactive-airdrop-excludes-proxy-contract-users-e-g-dharma-matcha-etc\/1222\">trying<\/a> to do right by their users who missed out on the airdrop.<\/p>\n<p>If you take a stroll through the Compound or Uniswap governance <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/compound.finance\/governance\/proposals\">dashboards<\/a>, you\u2019ll probably see the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a> issues I see with these types of \u201cdecentralized community governance\u201d protocols.<\/p>\n<p>Most proposals are submitted by a small clique of stakeholders, usually the team or some highly-related company (another name that often pops up is Gauntlet, which is funded by Paradigm, Polychain&#8230; and obviously Coinbase). It doesn\u2019t help that making a proposal on Compound requires a fully formed technical implementation and 100,000 COMP (worth $10 million or so).<\/p>\n<p>Sure, you may discuss things on the forums as a small holder. But I have serious doubts that those public forums are where the real decision-making occurs. To be fair, the Compound and Uniswap forums could not be more different. The former is a <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.comp.xyz\/t\/setup-community-cuni-voting\/440\">place<\/a> devoid of life or fun, the latter rages with discussion and <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/gov.uniswap.org\/t\/urgent-discussion-on-current-vote-reduce-uni-governance-proposal-quorum-thresholds\/7117\">accusations<\/a>.<\/p>\n<p><!-- Begin Mailchimp Signup Form --><link href=\"https:\/\/cdn-images.mailchimp.com\/embedcode\/classic-10_7.css\" rel=\"stylesheet\" type=\"text\/css\"\/><!--End mc_embed_signup--><\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_rich_get_richer\"><\/span>The rich get richer<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Somehow, I feel that the token distribution schemes had a very, very strong effect on that disparity. Uniswap\u2019s \u201creward anyone who randomly used us in the past\u201d was definitely much more equitable than Compound\u2019s \u201clet\u2019s distribute tokens with no lockup to whoever manages to pull in the most capital.\u201d\u00a0<\/p>\n<p dir=\"ltr\">In general, there\u2019s nothing really fair about yield farming launches \u2014 the richer you are the more tokens you receive and the richer you get.<\/p>\n<p>Most of all, this is not inventing anything new. It\u2019s a corporate board, plain and simple. Corporate boards benefit the team and the already-rich who can devote capital to the venture, it\u2019s just that with DeFi you get tokens instead of shares.\u00a0<\/p>\n<p>Honestly, crypto has always been oligarchical. And that\u2019s fine, that\u2019s human nature. But if we really want to make something different, we have to realize that our actions are taking us down the same path that formed the modern world.<\/p>\n<p>Maybe it\u2019s possible to have a truly decentralized governance system \u2014 whatever that means \u2014 but it certainly won\u2019t happen when we actively reward wealth with control. (And control with more wealth.)<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_blame_games_are_getting_out_of_hand\"><\/span>The blame games are getting out of hand<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>A story that made me chuckle is the sincere belief shared by some that YFI fell because Alameda Research (the company behind the FTX exchange) shorted it.<\/p>\n<p>The blockchain doesn\u2019t lie, and CEO Sam Bankman-Fried didn\u2019t exactly deny it, so maybe it\u2019s true.<\/p>\n<p>Of course the logical reason for a bull to get irritated about shorting is that by doing so, bears create extra selling pressure. And that\u2019s probably true, but one also has to remember that they provide extra buying pressure on the way down. It\u2019s quite well <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.jstor.org\/stable\/4479091?seq=1\">established<\/a> that futures \u2014 which make shorting very easy \u2014 dampen the overall volatility of the market.<\/p>\n<p>Emotions are running high, and anger is usually associated with the bottom of a market cycle, so maybe this news is actually good?<\/p>\n<p>But there\u2019s another blame <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a> that makes very little sense and suggests people are still crazy. Andre Cronje, the founder of Yearn Finance, is once again being attacked because people \u201caped in\u201d to one of his unreleased <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/medium.com\/@andre_54855\/crypto-economics-perpetual-liquidity-and-il-offsets-197558347a53\">projects<\/a>.<\/p>\n<p>It was basically an impermanent loss mitigation proof-of-concept for other developers to try. People put huge sums of money and then lost it \u2014 one particular <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/etherscan.io\/address\/0xf07f2b6c340d8d303615710451c11e93fe56774d\">address<\/a> put in 1,000 ETH and got back 74 ETH.<\/p>\n<p>But despite Cronje\u2019s giant, stark warnings (see below) people were still bashing this as yet another example of him \u201ctesting in prod\u201d and making people lose money.<\/p>\n<p>Except that, well, nothing actually happened. The system worked fully as intended, nobody got hacked. This is just what usually happens when you pile into some random smart contract.<\/p>\n<p>So, errr, maybe read the sign. Then there\u2019s nobody to blame and we can all enjoy DeFi again.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" width=\"778\" height=\"444\" alt=\"\" src=\"https:\/\/s3.cointelegraph.com\/storage\/uploads\/view\/6d5c3e5444443415dbe875e9c188252a.jpg\"\/>\n<\/div>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener noreferrer\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/finance-redefined-can-defi-and-on-chain-governance-change-human-nature-oct-7-14\" target=\"_blank\" rel=\"noopener noreferrer\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Finance Redefined: Can DeFi and on-chain governance change human nature? Oct. 7-14 &#8221; This week, one bit of news really grabbed my attention: Dharma getting criticized for allegedly trying to capture Uniswap governance. Dharma is the company behind a crypto payments and exchange app, a sort of Ethereum-based cousin of Square\u2019s Cash App. Or&#8230;<\/p>\n","protected":false},"author":1,"featured_media":89705,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/storage\/uploads\/view\/43acf69f2475bf1b057a9cb9227c7d6e.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74868,74891],"class_list":["post-89704","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-defi","tag-ethereum"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/89704","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=89704"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/89704\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/89705"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=89704"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=89704"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=89704"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}