Compound community accuses the large COMP holders of attacking the management of the protocol

What’s new? The decentralized lending protocol Compound Finance has passed proposal number 289, which allocates 5% of the assets from the project’s $24 million treasury to a revenue protocol created by a group of large holders of the COMP governance token called Golden Boys. The community called the event an attack on governance and accused the whale group of imposing the initiative by buying a large volume of tokens on the open market.

Community vote

What else is known? The vote on the proposal, which would allocate 499 000 COMP tokens to the Golden Boys group for the goldCOMP revenue protocol for one year, was held from Thursday through Sunday and received 682 191 votes in support, while 633 636 were opposed.

Community member and developer Michael Lewellen identified a connection between several accounts accumulating COMP tokens on the open market and several proposals aimed at raising funds for the goldCOMP product.

Notably, Proposition 247 had already been voted on May 6, where goldCOMP was also asked to allocate 5% of its funds from the Treasury, but it did not reach a quorum at the time and was canceled. On July 19, a similar motion number 279 was put forward, proposing to allocate 92 000 COMP tokens to goldCOMP, but it was also rejected.

At the time, other members of the Compound community, including the Wintermute market maker team, criticized the proposal because, if adopted, it would give the Golden Boys group full control over the funds transferred.

Thus, the initiative proposes to create a wrapped version of the COMP token called GoldCOMP, with it housed in a separate vault managed by Golden Boys and funded by COMP. One Golden Boys member under the nickname Humpy claims that this will provide additional passive income for long-term COMP holders.

According to his idea, users place COMP in the Golden Boys repository and in return receive goldCOMP tokens, which can be placed in special pools.

Lewellen called the new vote an attack on the governance mechanism, as the Golden Boys group seeks to gain control of the treasury despite the dissent of other members of the decentralized autonomous organization (DAO) Compound.

Since Proposition 289 has already been approved, 499 000 COMP tokens are expected to flow into Golden Boys’ multi-signature wallet on July 30.

Messari analysts previously reported that Humpy controlled over 50% of the voting power of the Balancer protocol for several months in 2022, allowing him to solely manage the project. The parties later came to an agreement.

In March this year, SushiSwap developer Jared Grey also revealed Humpy’s attempts to seize control of the exchange for profit.

Against the backdrop of this news, the value of COMP fell by 5,5% over the day. The asset occupies the 188th place in the ranking of cryptocurrencies by market capitalization with a figure of $329,2 million and is trading at $48.