UNFI token holders are set to approve the start of DAO governance after a referendum put forward by the team at Unifi looks set to pass in favor of DAO governance. The referendum looks set to pass quickly, with nearly all votes polled so far voting to create the Unifi Guardians DAO.
Moving Towards A DAO Global Governance Model
The Unifi Protocol moved towards a DAO Global Governance Model (GGM) when the UNFI governance token was launched in November 2020. UNFI was selected as Binance Launchpool’s 8th project and was among the top 5 performing projects on Binance Launchpool.
An experienced team created the Unifi Protocol with years of experience in the blockchain industry who have banded together to create a new type of protocol within the DeFi ecosystem.
The protocol brought in concepts such as creating a multi-chain protocol, a liquidity provider rewards token that is 100% backed and redeemable, and community governance that is not limited to one blockchain. Currently, Unifi operates DeFi and staking operations on eight different blockchains and has multiple platforms that can be used.
Limitations Of Other Governance Tokens
Other governance tokens have several limitations when it comes to offering DAO-style functions. Governance token holders are restricted to voting only on contract parameters or other items that are entirely on-chain. UNFI token holders, on the other hand, have been able to vote on a variety of issues such as UNFI staking rewards, blockchain node operations, staking, significant acquisitions, and several other development issues regarding the ecosystem.
Becoming A DAO
The Unifi Protocol was created with the intention of becoming a DAO. For the Protocol to become a DAO, Unifi Protocol has identified steps that would need to be taken when it comes to the evolution of the DAO. The order of the steps will be determined along with the evolution of the UNFI GGM. The steps to be taken are as follows,
- The DAO’s first version is deployed, which will focus on enhancing contract security.
- Select contracts are turned over to the DAO.
- Unifi will take in community input on the evolution of the GGM and other fine tunings.
- Unifi Protocol will initiate the upgrade to the Referendums system, enabling governance actions outside smart contracts.
- Unifi will encourage greater participation in the DAO.
- All smart contract parameter changes will include a time lock.
- UNFI token holders will be able to gain control of select smart contract parameters. These can also be via a proxy.
- UNFI token holders will then vote to gain control of other additional parameters.
Creating The Unifi Guardians DAO
Unifi Labs has already spent a considerable amount of time researching DAOs and DAO security so that the transition into DAO smart contract control can be carried out without any hitches. The current referendum put to the vote authorizes the creation of the Unifi Guardians DAO, as per the recommendations of Unifi Labs. Unifi has clarified that the DAO model is experimental and could be changed whenever needed.
Unifi Guardians will overlook and execute the parameter changes to Unifi Protocol’s smart contracts. The security enhancements need to be completed before the next phase can commence. Initially, there will only be around 3-7 Guardians, with the number of guardians adjusted as and when security and consensus are both tested.
UNFI Token Holders Vote Overwhelmingly In Favor Of 36% DeFi Staking Rewards
Unifi saw a record turnout of UNFI token holders when the protocol held a referendum to vote for increasing the maximum capacity of UNFI that can be staked. The referendum was held after Unifi received repeated requests from the Unifi community to increase the maximum capacity that users can stake.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.