a16z, a venture capital firm, has voiced opposition to the launch of Uniswap v3 on the Binance Smart Chain (BSC). The startup has raised concerns emerging in the ongoing debate in the DeFi community about the trade-offs between efficiency, security, and decentralization.
a16z weighed in on the debate, stating that launching Uniswap v3 on the BSC is a “bad idea” with potentially severe consequences for the DeFi space. The firm argues that the BSC’s lack of security compared to Ethereum puts user funds at risk. Its centralization could concentrate power in the hands of a few actors, undermining DeFi’s decentralized nature.
Uniswap controlled by a16z? https://t.co/9QTi1KjVjG
— CZ 🔶 Binance (@cz_binance) February 5, 2023
Uniswap v3, a new version of the well-known decentralized exchange, has caused mixed feelings since it came out on the Ethereum blockchain in 2021.
UNI governance control concerns
The Uniswap DAO forum reported that a16z had rejected the proposal to launch Uniswap v3 on the BNB Chain. In contrast, Robert Leshner, the CEO of Compound Labs, approved the deployment. The disagreement arose from the cross-chain bridge selection, specifically the Wormhole Bridge. The concerns revolve around a16z holding power to control 41.5 million UNI through 11 wallets, which constitutes more than 4% of the total supply.
You’re being lied to about the governance of UNI@a16z could control 41.5M UNI through 11 wallets, which represents more than 4% of the supply 4% is the required amount to pass any proposal 🧵↓ https://t.co/mVdTukYstD pic.twitter.com/u7l9kBFIWF
— Bubblemaps (@bubblemaps) February 5, 2023
According to the governance proposal submitted on Feb 2 by 0xPlasma Labs on behalf of the Uniswap community, voting took place with a check of 20 million (80.28%) votes for “yes.” 4.9 million (19.72%) voted for “no.” However, a16z used its 15 million UNI holdings to vote “no” to the move. Currently, only 3.6% of the total votes (36.26 million) have been cast, and the voting period ends on Feb 10.
Andreessen Horowitz (a16z) vote for LayerZero
a16z prefers LayerZero as the interoperability protocol, which is why it voted against the deployment. The partners of the venture firm voiced their intention to vote for LayerZero as the deployment bridge during the temperature check.
0xPlasma Labs reported that the stakeholders in the Uniswap community expressed a desire for trust-minimized bridges to be used for governance in the new Uniswap v3 deployment on BNB Chain. However, after a complex discussion and voting on Snapshot, the community chose the Wormhole Bridge for the deployment.
