The founder of Synthetix Kain Warwick believes DeFi governance is actually worse today than a year ago. He said governance just gets thrown out the window during a bull market. Warwick feels no one cares everyone wants to try and move as quickly as possible, and do the dumbest possible thing only. He said the critical stuff that takes a lot of thoughtfulness and experimentation just gets blown away.
Synthetix is a platform that allows users to hold and trade tokens that track the price of real-world assets. It was an early pioneer of yield farming as a token distribution model. Moreover, Synthetix was one of the first to spin out into three different DAOs to support Synthetix: ProtocolDAO, GrantsDAO, and SynthetixDAO.
Warwick says the governance theatre is the next key problem crypto governance needs to solve. He highlighted the problem of multi-signature wallets and voting platforms like Snapshot. A multi-signature wallet or multi-sig is a crypto wallet owned by multiple people. A majority consensus is needed among its owners in order to move the money within the wallet. It’s used by many large DAO treasuries. Snapshot is an off-chain governance tool for crypto community voting.
Fabien, Snapshot’s pseudonymous founder, said the tool helps increase participation in governance by removing costs for users. He pointed out that on-chain voting makes it easier to do trustless execution but makes it difficult to include non-whales and have advanced logic in terms of voting power.
Warwick highlighted that users vote with their tokens in Snapshot which sends a signal. He questioned where the signal goes, ideally to the multi-sig. However, the multi-sig is not responsible at all for that signal. Warwick said the multi-sig could say no. He argued that the shiny veneer of a lot of DAO tooling was just a rushed, bull market solution to governance. He believes the industry needs to take the time to connect a community’s votes directly to that multi-sig to have real control over a project’s treasury.