Juno Prop 16: We Can Vote Away Your Money for Free

David Z. Morris is CoinDesk's Chief Insights Columnist. He holds Bitcoin, Ethereum, Solana, and tiny amounts of different crypto assets.

A furniture 1 blockchain called Juno is connected the verge of doing thing radical: taking distant tens of millions of dollars’ worthy of a holder’s tokens utilizing an on-chain ballot by different users.

Juno, a smart-contract furniture 1 successful the Cosmos ecosystem, was allegedly the unfortunate of a Sybil-like onslaught successful which 1 idiosyncratic faked aggregate wallets to person a disproportionate stock of a caller airdrop. The wallet alleged to beryllium to the airdrop gamer present contains much than 3.1 cardinal JUNO tokens with a marketplace worth of conscionable implicit $122 million.

A caller Juno proposal, Proposal 16, would gully down the “Whale Wallet” to 50,000 JUNO tokens, which the connection describes arsenic a “fair share” of the airdrop. The connection argues that, beyond a substance of elemental fairness, the reversal is an existential necessity for Juno, due to the fact that the whale present has a immense stock of the network’s voting and economical powerfulness (“half of quorum,” according to the proposal).

Proposal 16 is unfastened for voting betwixt March 10 and March 15. Though it’s hard to beryllium certain, it appears this would beryllium the archetypal large lawsuit of a blockchain assemblage voting tokens retired of the hands of a chap holder. (The closest precedent whitethorn beryllium the removal of voting rights from immoderate tokens during Justin Sun’s attempted takeover of STEEM. Sun is the laminitis of the Tron blockchain.)

There are immense implications to sermon here, but they’re discussions we’re going to proceed having for a agelong time, truthful I’ll support it short.

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First, it’s utile to comparison this to the fallout from the hack of The DAO successful 2016. In that case, a declaration bug allowed the draining of an Ethereum-based concern money that astatine the clip contained 15% of each the ETH successful existence. The halfway enactment of Ethereum blockchain decided that the standard of the hack would endanger the semipermanent wellness of the ecosystem, and truthful they campaigned for a fork of Ethereum that took the hacker’s wealth away. That’s the fork that astir radical see “Ethereum” contiguous (This explanation of Ethereum is adjacent hard-coded into wallets similar MetaMask).

The fork that fto the DAO hacker support the wealth is present known arsenic Ethereum Classic, and it has a comparatively tiny but important assemblage to this day. Those allegiances are philosophical arsenic overmuch arsenic anything: Sticking with ETHClassic aft the DAO betterment fork was astatine the clip a rallying outcry for the “code is law” assemblage that saw the dense manus of founders including Vitalik Buterin successful pushing for the fork arsenic a betrayal of blockchain neutrality. Most users astatine the clip alternatively saw the incidental and its correction arsenic specified increasing pains (Ethereum had hardly launched), and astir existent users person astir apt ne'er adjacent heard of the DAO hack.

However you presumption it, the statement astir specified heavy involution changes considerably erstwhile it’s happening via on-chain voting, alternatively than done a fork. A fork is simply a fundamentally societal and nebulous process, often initiated by radical with powerfulness and influence, but requiring nationalist persuasion to marque definite miners proceed extending the “correct” chain. On-chain voting, by contrast, is some much rigorous and much opaque: Proposals laic retired wide outcomes, but arsenic Buterin himself has pointed out, it’s quite casual to bargain votes oregon manipulate the process successful assorted ways.

Whether it winds up being manipulated (the hacker surely has the funds to bargain votes), the scary portion astir Juno’s Proposal 16 is thing much fundamental. In a precise escaped sense, it undermines the halfway cryptocurrency worth proposition that if you power your ain backstage cryptographic keys, you person full power implicit your tokens.

Instead, it shows that blockchains, too, impact societal arsenic good arsenic method consensus. The airdrop Sybil attacker, aft all, didn’t interruption immoderate evident authorities laws; helium oregon she conscionable abused an unfastened strategy truthful severely that different users had to instrumentality enactment to support it. For some, this effect volition beryllium seen arsenic an upside and adjacent an evolutionary way – a important step, successful particular, toward decentralized autonomous organizations (DAOs) that person existent enforcement powerfulness and are consenting to flex it.

Even if you’re focused connected the upside, it volition beryllium important and hard to make a stronger favoritism betwixt systems with this benignant of on-chain capability, and those that connection existent irreversibility. Bitcoin, Ethereum and astir different large chains don’t person on-chain proposals oregon governance mechanisms that would marque this possible. Unfortunately, that’s a favoritism apt to beryllium mislaid connected the wide nationalist and adjacent connected astir crypto speculators.