By Mark Ackman
The DeFi space is famous for its ingenuity and creativity when coming up with new products and solutions. Recently, various DeFi projects have been working on governance experiments, such as DAO from Lido Finance making a deal with venture firm Dragonfly to create a $14.5 million deal.
Of course, for every firm that is able to make its dream project come true, there are others that struggle to make the most of what they have. Recently, one DAO held a community vote to use funds from the project treasury to help victims of a hack.
However, despite the community making it clear that they would want to help these individuals, the DAO decided to go back on their word.
This specific incident prompted DeFi guru Kain Warwick to mention this specific incident during his talk at SmartCon 2022. Suffice it to say that he had very harsh words for the way things were playing out in the DeFi space.
Discussion with Dan Roberts at SmartCon
As a speaking guest at the SmartCon 2022 event, Kain Warwick spoke at length about various issues in the DeFi space. During his talk there, Warwick also shared his thoughts about DeFi governance, where he controversially said that it is much worse than it was a year ago.
His major complaint with most governance practices is that they overlook its importance when things are going right. If it is a bull market, then companies will put governance to the side and focus on other prospects.
He believes that companies are just looking to move through the market as quickly as possible while doing the dumbest possible things. While governance is essential, it also requires a lot of time and effort, something that companies do not want to put in.
Warwick’s Experience Working in the DeFi Space
Warwick is the founder of Synthetix, which is a prominent company in the DeFi space since it is responsible for building what many have now termed as decentralized finance.
The platform itself allows individuals to trade and hold tokens that are tracking the prices of various real-world assets. In fact, this process made it a pioneer of yield farming as a distribution model, and it would even spin out into three different DAOs.
Governance Theater
Calling Warwick a pioneer of the DeFi space wouldn’t be hyperbole, as he was responsible for building new systems from the ground up. Therefore, he didn’t just criticize companies for using the right type of governance protocols, but they would also engage in something better known as governance theater.
He specifically pointed out that voting platforms like Snapshot didn’t actually do much to improve governance, and instead just made it look like they were doing a lot.