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Compound Finance, a decentralized lending and borrowing protocol, appears to be going through a tumultuous community disagreement over governance, according to community forums and a slew of recent proposals.&nbsp;
The <a href="https://compound.finance/governance/proposals/289" target="_blank" rel="noopener nofollow">passage</a> of proposal 289 on July 28 appears to have been the catalyst for a series of social media allegations that a governance attack has occurred, perpetuated by a voting bloc called the “Golden Boys.”
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 <img src="https://s3.cointelegraph.com/uploads/2024-07/5ba6a6f6-3073-4991-9ecd-0be3571d380d.jpg" alt="Compound Finance proposals elicit ‘governance attack’ allegations">
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 Source: <a href="https://x.com/DrNickA/status/1817656164638937237" target="_blank" rel="noopener nofollow">Dr. Nick</a>.
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Over on the Compound governance message boards, insiders specifically <a href="https://www.comp.xyz/t/trust-setup-for-dao-investment-into-goldcomp/5406/5" target="_blank" rel="noopener nofollow">warned</a> such an event would occur just days before as discussions over the proposals played out. 
<h2 id="governance-attack">Governance attack? </h2>
On May 6, Compound Governance&nbsp;<a href="https://www.tally.xyz/gov/compound/proposal/247" target="_blank" rel="noopener nofollow">shot down</a> proposal 247 when it failed to reach a quorum. The proposal, dubbed “Treasury to Invest 5% of COMP holdings into goldCOMP Vault,” was subsequently canceled.
The intent of the proposal, according to one of its purported supporters, was to establish a wrapped COMP token called “GoldCOMP” that would be held in a separate treasury operated by the Golden Boys and funded by COMP. This, claimed Golden Boy “Humpy,” in order to provide an additional layer of “passive income” for COMP holders, which would be invested and divested at the discretion of the Golden Boys. 
Per a post from Golden Boy member Humpy:
<blockquote data-ct-non-breakable="true">
 “When a user places COMP into the goldCOMP vault, the depositor receives goldCOMP, a semi-liquid wrapped token representing their initial deposit. These goldCOMP tokens can be placed in a 99/1 Balancer pool, creating a passive income stream for COMP holders who plan to hold COMP for a long period of time.”
</blockquote>
An updated proposal from the bloc, number 279, failed to pass a July 19 vote. It purportedly requested “a one-year investment of 92,000 COMP” be sent to the goldCOMP Treasury Fund."
On Compound Governance message boards, around the time of 279's failure, “Wintermute Governance,” representing the Wintermute bloc, expressed concerns the Golden Boys proposal would give the group complete control over the transferred funds.&nbsp;
 “Any form of withdrawal action (divest) is solely controlled by GoldenBoyzMultisig,” wrote Wintermute, adding that the separate vault “delegates the deposited COMP’s governance rights to the GoldenBoyzMultisig.” 
Michael Lewellen, of the OpenZeppelin bloc, under the username “cylon” went so far as to state that the Golden Boys proposal could be perceived as a governance attack:
<blockquote data-ct-non-breakable="true">
 “In my personal opinion, the actions of Humpy and the Golden Boys can be considered a governance attack if they persist in their attempts to take funds from the protocol in clear opposition to the will of all other Compound DAO delegates’.
</blockquote>
<h2 id="proposals-289-and-290">Proposals 289 and 290</h2>
On July 28, a subsequent proposal, number 289, from the Golden Boys <a href="https://compound.finance/governance/proposals/289" target="_blank" rel="noopener nofollow">passed</a> by a measure of 682,191 for to 633,636 against. The new proposal upped the amount of COMP requested to fund the goldCOMP treasury from 92,000 to 499,000. 
As of the time of this article’s publication, 289’s passage indicates an implementation date of July 30. It’s been <a href="https://compound.finance/governance/proposals/290" target="_blank" rel="noopener nofollow">followed</a> by proposal 290, “Precautionary Transfer of Timelock Admin,” which proposes sending the Compound Governance Timelock Admin to “CommunityMultiSig.” 
Transferring the Timelock Admin could potentially stymie future efforts to pass proposals similar to the Golden Boys. But it might be a case of too little too late when it comes to proposal 289. 
The 499,000 COMP requested — worth approximately $24.1 million as of the time of this article’s publication — will likely still move to the goldCOMP treasury fund on or around July 30 per the terms of proposal 289’s passage.

Compound Finance proposals elicit ‘governance attack’ allegations

Daftar Isi

Cointelegraph

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