Dune Analytics opposes $25M Uniswap grant to competitor
Disclaimer. This article has been updated to include comments from both Dune Analytics and Flipside Crypto as well as the fact that the governance vote has flipped in favor of those against the grant allocation.
Dune Analytics, a decentralized finance (DeFi) analytics service, has voiced its opposition to a Uniswap (UNI) governance vote for “Community-Enabled Analytics” that would see fellow analytics provider Flipside Crypto managing about $25 million worth of UNI tokens.
Tweeting on Thursday, Dune highlighted the lack of community attention to the matter while also stating that grants should be given to community members and not to service providers.
Indeed, the governance voting page for the proposal showed over 41 million votes in favor, against 2.5 million in opposition as of the time of Dune’s tweet. However, the tides have shifted with about 46.9 million votes against the proposal. The process will end on Friday, Aug. 20 at 7:05 AM UTC+1.
According to Dune, funding one single provider among several analytics platforms “makes no sense.”
“There is no sense for @uniswap to fund @flipside’s daily operations with eight full-time employees,” Dune added in its tweet.
Fredrik Haga, CEO and co-founder of Dune Analytics further explained that platform’s opposition to the grant proposal, telling Cointelegraph:
“This proposal is de facto giving them [Flipside Crypto] as a single provider control of the allocation committee and the oversight committee which makes little sense for driving forward UNI analytics broadly.”
The grant itself, if passed, will see Flipside Crypto receive $25 million in two annual installments of $15 million and $10 million respectively.
Responding to these criticisms, Avi Meyers, director of strategic partnerships at Flipside Crypto told Cointelegraph:
“The root of the concern about providing service providers with grants is a fear that they may be bad actors or not contribute directly to the core community. Ironically, the entire focus of Community-Enabled Analytics is to build a community for protocols through educational programs and on-chain analysis — rewarding contributors for their efforts.”
According to Meyer, given the substantial sum involved in the grant, checks and balances exist to ensure robust oversight of the platform’s utilization of the funds.
“The seven-member Allocation Committee will ensure the investment strategies properly benefit the ecosystem, while the three-member Oversight Committee will ensure that the grant is applied in a manner consistent with its design,” Meyer told Cointelegraph.
Half of the yield generated by Flipside from the fund will reportedly go towards improving the Uniswap ecosystem in the form of bounties to community members, according to the details shared in the proposal document.
The other 50% of the yield generated by Flipside will be used to fund the platform’s operations such as payment of salaries — a provision that could be construed as a 50% management fee on earnings from a community grant.
Defending the 50% yield retention, Meyer told Cointelegraph that the provision was necessary to enable the team to achieve the aims and objectives of the grant.
Commenting on Dune’s decision to bring the issue to the forefront, Haga told Cointelegraph: “Dune Analytics are not big UNI holders and think the Uniswap community should decide on this,” adding:
“The proposal was about to pass while under the radar and we wanted to bring attention to how these $25M in UNI was about to be allocated and from there we’re simply glad to see that the community is taking note, discussing and landing on their own conclusions.”
Related: Uniswap proposal under fire for enabling Dharma to ‘take over governance’
Dune’s opposition to the proposed $25 million grant to its competitor is the latest controversy stemming from the apparent centralization of Uniswap’s governance.
Back in July, the DeFi Education Fund came in for some criticism within the crypto space for liquidating half of its one million UNI token donation amounting to about $10 million at the time.
The DeFi Education Fund did defend its actions stating that the move was necessary to kickstart its operations.