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Restructuring the Governance System of 1inch: A Proposal to Reduce the Voting Rights of Internal Personnel

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According to reports, 1inch, a crypto transaction aggregator, held a community teleconference on Friday. Team members proposed to weaken the voting weight of some internal personne

Restructuring the Governance System of 1inch: A Proposal to Reduce the Voting Rights of Internal Personnel

According to reports, 1inch, a crypto transaction aggregator, held a community teleconference on Friday. Team members proposed to weaken the voting weight of some internal personnel. The proposed governance restructuring would significantly reduce the voting rights accumulated by core contributors, investors, and other insiders. Jordan Reindl, a member of the 1inch community and governance team, said that the current system “to some extent grants investors a disproportionate amount of voting rights, especially when their v1inch token contract is fully locked up.” The proposal has not yet been voted on. The v1inch token is a redeemable derivative token of 1inch.

Members of the 1 inch governance team propose to weaken the voting rights of some internal personnel

Introduction

On Friday, the 1inch crypto transaction aggregator held a community teleconference where team members proposed to restructure the governance system. The proposed changes would reduce the voting power of internal personnel such as core contributors and investors. The idea behind this proposal is to address the disproportionate voting rights granted to the investors when their v1inch token contract is fully locked up. This article delves deeper into the proposed governance restructuring of 1inch and its potential impact.

Understanding the Current Governance System of 1inch

Before we delve into the proposed changes, it is essential to understand the current governance system of 1inch. The platform employs a DAO (Decentralized Autonomous Organization) model, where the community members who hold the v1inch token have the power to vote on proposals and make decisions for the platform.
The voting power is directly proportional to the number of v1inch tokens held by the voters, and tokens need to be staked for a specified period to accumulate voting rights. This system grants investors a significant amount of voting rights, which can sometimes lead to disproportionate decision-making power and a lack of representation for smaller stakeholders.

The Proposed Governance Restructuring of 1inch

The proposed changes in the governance system of 1inch aim to address the concerns expressed by the community members about the current voting system’s flaw. The proposal suggests reducing the voting weight of core contributors, investors, and other internal personnel.
The plan is to introduce a quadratic voting mechanism, which will ensure that voting power is distributed equally among all the stakeholders and prevent investors from accumulating a disproportionate number of voting rights.
The proposed restructuring would mean that as the number of v1inch tokens held increases, the voting power increment will be less than proportionate. This way, even large stakeholders will not be able to dominate the decision-making process.

The Impact on the Community and the Platform

The proposed governance restructuring has received a mixed response from the community. Larger stakeholders who hold a substantial number of v1inch tokens might interpret this move as a way of limiting their influence on the platform’s direction. On the other hand, smaller investors and community members who hold a negligible number of tokens will welcome the proposal as it will give them better representation.
The proposal also raises questions about the long-term impact on the platform’s growth and development. While the proposed restructuring would lead to a more equitable distribution of power among stakeholders, it might discourage investors from holding large numbers of v1inch tokens in the future, which could negatively affect the platform’s overall market capitalization.

Conclusion

The proposed governance restructuring by 1inch is an attempt to address the ongoing concerns about the current voting system and create a more equitable distribution of power among stakeholders. While the proposal has yet to be voted on, its potential impact on the community and the platform cannot be overlooked.

FAQs:

Q1. What is 1inch, and how does it work?
1inch is a decentralized crypto transaction aggregator that utilizes smart contract technology to offer the best possible rates for users, drawn from various decentralized exchanges (DEXs).
Q2. What is the v1inch token, and how is it utilized?
The v1inch token is a derivative, redeemable token of 1inch, utilized for governance and staking on the 1inch platform.
Q3. What is Quadratic Voting, and how does it work?
Quadratic Voting is a new way of voting that allows stakeholders to transfer their voting rights to the policies they care about most. The voting power increases exponentially as the number of tokens increases, ensuring more equity in the decision-making process.

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