US Judge Says Governance Tokens Might Carry Legal Liability
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Here’s what we are covering today:
Regulation
News
- Arbitrum Airdrop is Helping Smaller DAOs Survive the Bear Market
- Aave To Launch on Polygon zkEVM
- Kava Flips Solana As New Lending Protocol Boosts TVL
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Regulation
DAOs
US Judge Says Governance Tokens Might Come With Legal Liability
bZx DAO and Founders Were Sued After $55M Hack
The DAOs that govern supposedly decentralized crypto protocols have been pitched as 21st-century cooperatives whose members share in decision-making and, sometimes, profits.
According to a federal judge in California, they could share legal risk, too.
Owners of BZRX, a so-called governance token, could be held liable for a $55M hack, District Judge Larry Burns wrote on Monday in an order allowing a class-action lawsuit to move forward.
At stake are questions that get to the very heart of decentralized finance – what does it mean for an organization to be decentralized? What obligations do members of a DAO have to each other, and to the people who use the protocol they ostensibly control?
Read the full story in The Defiant
News
Dive
Arbitrum Airdrop is Helping Smaller DAOs Survive the Bear Market
Layer 2’s unique airdrop is throwing some crypto projects a lifeline
By Owen Fernau
Arbitrum, an Ethereum scaling solution, made airdrop history by distributing tokens to treasuries of decentralized organizations, not just to individual wallets. Of 1.3B tokens airdroppped, 8.9% were gifted to 137 DAOs.
Projects large and small are debating what to do with the windfall, which amounts to over $1M for 42 of the 137 which are to receive ARB tokens.
It’s a new wrinkle to the saga that has been airdrops in crypto the past few years — while individuals don’t have to poll anyone about what to do with their “free money,” DAOs certainly do.
Read the full story in The Defiant
DeFi
Aave To Launch on Polygon zkEVM
Leading DeFi Lender Looks To Expand L2 Presence
By Samuel Haig
Aave, the top decentralized lending protocol with nearly $8B in total value locked (TVL), is set to launch on Polygon’s new zkEVM Layer 2 network.
A preliminary poll pitching the deployment on Polygon zkEVM passed on Wednesday with near-unanimous support. The proposal will now move to a formal on-chain vote.
If passed, the deployment could offer significant benefits for both projects. Aave v3 could drive significant value onto Polygon’s fresh-faced zkEVM network, while potentially giving Aave a competitive edge over rival lending protocols seeking to deploy on the network.
Read the full story in The Defiant
Cosmos Ecosystem
Kava Flips Solana As New Lending Protocol Boosts TVL
Team Behind Mare Finance Replicates Optimism Playbook
New DeFi applications on Kava, an Ethereum-compatible blockchain in the Cosmos ecosystem, have sent user deposits soaring over the past month.
Since March 1, the total value locked (TVL) on Kava has risen almost 80% to $350M, leapfrogging popular Layer 1 blockchain Solana, according to Defi Llama. TVL is a measure of the value of crypto deposited on a platform.
The surge has been driven by a pair of new applications – Mare Finance, a lending protocol, and to a lesser extent Équilibre, a decentralized exchange. The network’s KAVA token is up 60% since the beginning of the year.
Read the full story in The Defiant
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