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Uniswap’s governance raises concerns of decentralization

Cryptocurrency

The Unsiwap governance vote has been a hot and controversial issue, with issues raised around its centralization

There are concerns that a flash crash Ethereum could happen when UNI mining is completed in November. Industry experts embarked on the search for more flaws, in addition to the concerns of centralization resulting from the first Uniswap governance vote.

The whale’s last report took on the proponent side of the Dharma. The conclusion of the vote, therefore, means that only a handful of addresses with the majority of UNI tokens will have governance power.

It is important to note that three addresses accounted for almost all 39.5 million votes in favor of the proposal, with only about 700,000 in opposition. The approval of Dharma and Gauntlet’s proposals gives them a majority if they agree with any future decision. However, this is not the only thing to worry about.

According to Ryan Berckmans of Predictions Global, governance can be an obstacle for the DeFi industry. Berckmans also predicts that central control can impact volatility on Uniswap.

Another concern is the completion of UNI’s liquidity mining on November 17. Berckmans points out that about $ 800 million in Ethereum will be withdrawn from the pools when they expire. This, in turn, could result in a sudden crash and even upset the entire decentralized financial sector.

For him, the viable way to keep the sector stabilized is to perpetuate UNI’s incentive to agriculture. He also recommended designating executives to act as governance officers similar to what Ethereum adopted with Tim Beiko and the new EIP 1559 fee proposal.

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