Centralization Comes to DeFi as Group Behind MIM, SPELL Tokens Mull Legal Shakeup

Centralized concern structures are continuing their creep into decentralized concern (DeFi), with the builders of tokens Magic Internet Money (MIM) and SPELL connected Wednesday pitching a accepted ineligible operation to supplant the DAO overseeing the stablecoin with a astir $700 cardinal marketplace cap.

In a forum post, a task person called connected Abracadabra DAO to enactment a “transition of power” to a centralized entity implicit with lawyers, jurisdictions and trustees. Those trappings of a accepted corp are seemingly antithetical to the conception of a DAO, the signifier of crypto-based concern governance successful which token holders straight telephone the shots.

“Despite our committedness to decentralization, we’ve recognized the value of introducing a definite grade of centralized ineligible structure,” the AbracadabraTeam relationship wrote. “The intent present is not to disrupt the decentralized quality of Abracadabra; successful fact, it’s to support it.”

Abracadabra DAO is the latest crypto task swapping the lofty idealism of decentralized governance for immoderate grade of centralization, alongside SushiSwap and different projects. The reasons for these transitions scope from heightened regulatory scrutiny to much mundane concern concerns.

For Abracadabra DAO, the publicly-shared reasons look to tilt toward vanilla. AbracadabraTeam said the centralized entity would negociate the DAO’s intelligence spot arsenic good arsenic server expenses “while inactive keeping power successful the hands of SPELL token holders.”

Holders of SPELL (Abracadabra DAO’s governance token) volition ballot the task done 3 phases of transition, starting with picking a jurisdiction for the caller entity. Four countries are connected the table: Switzerland, Singapore, Malta and Bermuda.

Phases 2 and 3 volition specify what the caller entity’s roles are and however it volition operate, according to the post.

At property time, the SPELL token was trading 2.8% little implicit the past 24 hours.