Token Holders Don’t Give a Damn About Voting Rights and Community Governance

Token Holders Don’t Give a Damn About Voting Rights and Community Governance

You’ve probably heard of The DAO and you’ve certainly heard of the ICO. Now say hello to the DAICO, an “innovative fundraising model” that aims to combine the best of both frameworks. The Abyss Platform is the first project to utilize this hybrid organizational structure, which has been credited as the brainchild of Vitalik Buterin. There’s just one problem with The DAO, the ICO and the mutant DAICO it’s spawned – the public couldn’t give a damn about key tenets such as voting rights and community governance. All they want is cheap tokens they can flip for a quick profit.

Also read: U.S. Corporate Customers Barred From Bitfinex’s Margin Markets

Live and Let DAICO

The DAO (decentralized autonomous organization) was the first major project to be launched on the Ethereum blockchain, complete with a novel governance structure that replaced a board of directors with a community-run model. It didn’t end well. A vulnerability in the code saw one third of the ether committed to the project stolen and The DAO collapsed. As prominent crypto critic and agent provocateur Preston Byrne explains:

The original DAO could pass resolutions with a simple majority drawn from quorum of 20% (meaning as little as 10% +1 of the investors could bind the remaining 90%). No resolution ever passed because none of the tokenholders actually cared enough about what the DAO was doing in order to participate. Their primary motivation was to sit on their hands and wait for their investment to pay off.

Byrne may be a perennial bitcoin bear, but as a practising English solicitor, he knows more than most when it comes to the sort of legal matters that DAOs and DAICOs were meant to solve. Take a look at many of this year’s ICOs and you’ll find, somewhere in their roadmap, talk of token holders being empowered to vote on key protocol changes including platform developments and new features. It all sounds very progressive and democratic, but the trouble is even the loyalest of community members don’t care enough to want to micromanage decisions using the power invested in them by tokens. The real reason why ICOs are so eager to assign voting rights to their investors is to add legitimacy to their claim that the token is a utility and not a security.

Token Holders Don’t Give a Damn About Voting Rights and Community Governance

Good Intentions Lost in the Abyss

The Abyss “merges some of the benefits of Decentralized Autonomous Organizations (DAOs), aimed at upgrading and making the initial ICO concept more transparent and secure”. It allows “token holders to control the fund withdrawal limit, also providing an option to vote for refund of the remaining contributed money in case the team fails to implement the project, with Oracles (appointed industry leaders) acting as arbitrators.” The idea is plucked from a concept Vitalik Buterin mooted a few weeks back.

Token Holders Don’t Give a Damn About Voting Rights and Community Governance

In his scathing critique of the DAICO, Preston Byrne writes: “I feel like I’m taking crazy pills here, because the SEC literally wrote a report about the original DAO scheme, likened it to a security, and cited as authority for this proposition not one but TWO cases relating to an infamous 1970s pyramid scheme that landed its promoter in federal prison for nearly a decade.”

He finishes: “A DAICO is nothing more than a new acronym for the same old bad ideas. The broken DAO concept, in particular, requires extensive rethinking and movement onto private/permissioned blockchains in order to shed its pyramid scheme-like qualities and serve a useful function. On account of which I am completely amazed that anyone would want to combine the DAO and ICO concepts under any circumstances.”

Original thinking deserves a chance to flourish, and blockchain governance – for all its pitfalls – may yet find a way to work. It probably won’t arrive in the form of the DAICO though or any of the other “revolutionary” governance models being used to float the current crop of crowdsales. Good ideas will ultimately prevail, while the ones deemed too wacky and unworkable will return to the abyss that spawned them.

Do you think blockchain democracy and token-based voting is a viable concept, or is it destined to fail? Let us know in the comments section below.


Images courtesy of Shutterstock, Twitter, and Ethersear.ch.


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The post Token Holders Don’t Give a Damn About Voting Rights and Community Governance appeared first on Bitcoin News.

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover

Myetherwallet, the web’s most popular client-side ethereum interface, has announced a surprise rebrand. The service will henceforth be known as Mycrypto following an acrimonious split. The sudden move took one half of the Myetherwallet team by surprise, who claims the “Twitter handle was changed without knowledge or permission of MEW’s founder”. It has also emerged that a lawsuit was filed in December, with one party alleging that the other failed to allow them to inspect the company’s books. It now looks like there will be two competing brands moving forward, Myetherwallet and Mycrypto.

Also read: Bitcoin Couture Makes Its Debut at New York Fashion Week

Myetherwallet Hard Forks

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover
Mycrypto’s Taylor Monahan

On Thursday evening, the Myetherwallet Twitter account announced to its 77,000 followers that it had rebranded as Mycrypto and had a new Twitter handle to match. There was just one problem: founder Taylor Monahan doesn’t seem to have told her co-founder Kosala. The revelation sparked a Twitter spat and overshadowed what had initially looked like a slick rebrand. The first ethereum wallet with a proper interface, MEW, as it’s affectionately known, has been around since 2015.

Its users witnessed the DAO hack and subsequent hard fork of the ethereum blockchain to create two versions of the coin: ETH and ETC. Now, MEW has undergone its own hard fork that’s set to be every bit as contentious as the one that came in the wake of the DAO. In a blog post, Taylor explained the reasons behind the rebrand – but conveniently forgot to mention that she had done so without the consensus of her founding partner, and had nabbed the Twitter account into the bargain. In December, Kosala filed a lawsuit in California after Taylor allegedly refused to let him inspect MEW’s books.

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover

Headed “A New Beginning”, the post begins: “This is the story of Myetherwallet, and how this has led us down the path to Mycrypto. It is long because I hope it gives you insight into who we were, who we are, and who we aim to be in 2018 and beyond.” The article then delves into MEW’s humble beginnings in 2015 when it was created by Taylor and Kosala. She explains: “It was a simple interface that provided a simple solution to a problem: when Ethereum first launched, the only way to send your Ether was via command line.”

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover

The ICO Years

Myetherwallet started out as little more than a hobby, but by 2017, amidst peak ICO mania, had become the hub around which the entire ethereum community revolved. Taylor recalls:

When the price skyrocketed, ICOs and noobs came zooming in on the promise of getting rich. We suddenly had a real user base and real servers that we had to learn to scale. The phishing sites appeared and the work and expertise to be secure in this space climbed steadily. Our daily messages doubled, and then doubled again… and again… and again.

She confesses that the toll of answering support tickets until long into the night took its toll. “My husband..cooked dinner each evening, and carried me to bed at 4am… then 5am… then 7am when I fell asleep typing at the computer. I consistently chose “trying to help one more person” over “a few more moments of sleep”. And there was “always one more person.”

Mighty Wallets From Tiny Acorns Grow

Moving to the present day, Taylor explains: “This adventure needed to transform from ‘fun side project’ to ‘a real company’ …and fast.” As of today, ethereum users can get their ethereum fix from Mycrypto.com which operates just like Myetherwallet.com. “Myetherwallet will continue to be online until it, for whatever reason, is not online,” writes Taylor, hinting at the fact that the rebrand may not have been a unanimous decision.

It is evident that a rift had developed between MEW’s founders, who had once been so tight, for Taylor writes: “I was terrified — am terrified — at the potential harm this change will have on myself, the team, and/or the Ethereum community but ultimately, the risks created by continuing down the road we were on are greater than the risks of splitting to a new brand, new company, new name, and new domain.”

Myetherwallet Relaunches as Mycrypto Following a Hostile Twitter Takeover
MEW’s Kosala

Within minutes of tweeting news of the rebrand, Kosala hit back via a new MEW Twitter account, writing: “Myetherwallet is safe and functioning normally. You may continue to use Myetherwallet as you normally would, your wallets have not been compromised. At present, we are dealing with  what we believe to be an unlawful, social media account switch. We are addressing the situation presently and @kvhnuke_ will provide updates as they come available”. He has since provided a full statement confirming the split.

The Ethereum community are accustomed to dealing with splits, but the forking of Myetherwallet seems to have caught everyone unawares.

Which wallet will you be using to send ethereum – MEW or Mycrypto? Let us know in the comments section below.


Images courtesy of Shutterstock, and Mycrypto.com.


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