Wormhole Faces Up Against Special Interests in Uniswap-BNB Chain Bridge Proposal
The votes coming in for the governance bridge deployment are casting a dark shadow on industry behavior.
a16z Votes to Remove Wormhole Bridge
Wormhole faces a significant challenge in its bid to become the Governance Bridge for Uniswap’s deployment on BNB Chain. The major venture capitalist a16z has lobbied against the proposal with all 15 million of its $UNI tokens, worth over $105 million.
Despite only 10% of the token supply voting, the nays against Wormhole are winning the vote by more than 64% as of February 5. The voting period began on February 4 and will end on February 10. Uniswap’s use of all 15M tokens in a vote is the first time the VC has done so, signaling a significant shift in power from the group.
a16z votes against proposal to deploy latest Uniswap $UNI iteration on BNB Chain@a16z used all 15M of their $UNI tokens (worth over $105M) to vote against the proposal, which would use the Wormhole bridge for the @Uniswap V3 deployment on @BNBCHAIN.
— TOP 7 ICO | #StandWithUkraine🇺🇦 (@top7ico) February 5, 2023
The wormhole was recently chosen as a possible cross-chain governance messaging bridge between Ethereum and BNB Chain when Uniswap v3 launches in Spring 2023. The wormhole was chosen by the Uniswap community over the other three bridges: Celer Network, LayerZero, and Debridge.
Uniswap is the most active Decentralized Exchange (DEX) in the cryptocurrency industry, and its actions have a significant impact. The competition for protocols to facilitate Uniswap’s deployment onto the BNB Chain is heating up, as power and influence can help a project succeed.
And a16z’s departure is causing consternation. Because a16z is a major backer of the bridge LayerZero, which lost the initial proposal, the vote by a16z is causing some controversy in the world of Decentralized Finance (DeFi). A16z was instrumental in raising $135 million for LayerZero in 2022.
a16z is a large investor in Wormhole competitor, @LayerZero_Labs.
Open your eyes. 👀
— Chris Blec (@ChrisBlec) February 5, 2023
Many people on social media have spoken out against the optics of the bridge bids. The bridge decision appears to be devolving into a backroom battle between venture capitalists and special interest groups. The criticisms center on how the bids demonstrate the negative role that special interest groups can play in DeFi growth.
Is this a positive sign for the DeFi community? According to Steven Zheng, Research Director at The Block, the vote may have gone too far.
Uniswap temperature check spurs feverish backroom maneuvering among crypto VC heavyweights https://t.co/3mLGlzsd6W
— The Block (@TheBlock__) February 1, 2023
The proposal is still up for vote in less than a week. The Uniswap community has complete control over the outcome of the election. Uniswap expects to complete the bridge to BNB Chain by the second quarter of 2023.
Uniswap was founded in November 2018 and has since grown to become the largest decentralized exchange in its category. It was created open-source on the Ethereum blockchain and employs the AMM model to enable Ethereum ERC-20 token swaps. Uniswap
Uniswap is responsible for much of the progress made in Ethereum-based DeFi expansion because it provided the market-making utility for Web3 apps to function in a decentralized environment. The platform consistently records daily trade volumes in excess of $500 million and has a total volume locked (TVL) of over $3 billion. Since its inception, the platform has transacted over $1 trillion in over 129 million transactions.
Where to find Uniswap:
What is Wormhole:
The Wormhole Network is a generic message-passing protocol that connects high-value blockchains and enables applications to use the messaging layer to facilitate ecosystem interoperability. Developers can use the protocol, which is guarded by 19 guardians, to send arbitrary data cross-chain, such as tokens, NFTs, Oracle data, governance decisions, and more.