The end of Sushi DAO?

With less than two days left to vote on the controversial Burū no Shinka proposal, Sushi DAO as we know it may be approaching its last days. On-chain voting data points to the imminent approval of the proposal.

As of press time, around 19 million SUSHIPOWAH tokens, accounting for a whopping 98.8% ‘yes’ votes, were backing the proposal. However, it appears there is more than meets the eye.

Burū no “the Beginning”

Titled “Evolving Sushi – Burū no Shinka,” the contentious governance proposal advocates transitioning to a “Labs model” that would effectively diminish the role of the decentralized autonomous organization (DAO) and vest control of SushiSwap’s multimillion-dollar treasury in a new entity called Sushi Labs.

The proposal was introduced by SushiSwap’s core development team on March 26. It outlines plans to empower Sushi Labs with “exhaustive and sole operational responsibility” for core product development. Perhaps most controversially, it calls for transferring the vast majority of SushiSwap’s treasury assets, comprised of various cryptocurrencies, to Sushi Labs’ custody.

Critics have vehemently opposed the move, accusing the core team of orchestrating a hostile takeover to consolidate power and undermine the project’s decentralized ethos. Naïm Boubziz, a prominent SushiSwap contributor, sounded the alarm on social media, labeling it “THE real hostile takeover.”

Under the proposal’s vision, the DAO’s role would be primarily limited to on-chain governance related to the treasury and token supply, with no involvement in Sushi Labs’ operational decisions or staffing. Jared’s position as “Head Chef” would transition to focus solely on advancing Sushi Labs.

The Bifurcated Vision: Development Speed vs. Decentralized Ideals

Proponents argue that the restructuring is crucial for SushiSwap’s competitiveness, enabling faster development, talent acquisition, and multi-chain expansion through a “franchised DEX model.” The proposal requests a 25 million Sushi token grant to Sushi Labs, positioning it as the sole recipient of future airdrops.

Community Skepticism: Enrichment Over Innovation?

Despite these arguments, a significant portion of the community remains unconvinced. Many view the proposal as a self-serving ploy by the core team to enrich themselves at the community’s expense. Calls have been made for open communication and a clear roadmap for Sushi Labs’ structure and decision-making processes. A member of the community known as “SushiCitizens” labeled the drama an “End of DAO.” They said:

“It appears that Sushi DAO is at the end of its journey. This is the final nail in its coffin and will guarantee its transition into a poor man’s Uniswap. Hayden must be belly laughing […] It’s an affront to the concept of a DAO, and can be viewed as yet another manipulation of due process. This time all of Sushi DAO’s assets will be consumed by a private organization to the benefit of a very small few. it is irreversible.”

The outcome of this internal battle will have far-reaching consequences not only for SushiSwap’s future but also for the broader DeFi ecosystem. This controversy reignites the debate about navigating the tension between efficient project management and maintaining a truly decentralized structure. The way SushiSwap navigates this crisis will be a case study for other DAOs grappling with similar challenges.

The project’s future hinges on its ability to rebuild trust, ensure transparent governance, and find a path forward that respects the principles of decentralization that laid the foundation for its success.