JUNO community has a big decision to consider.
A fascinating discussion is happening in the JUNO community at the moment, that could have some far reaching ramifications. Long story short, the community is debating whether to remove over $100 Million worth of JUNO from one whale's wallet, and put it in the community fund. The exact proposal can be found here, but I'll try to fill in my understanding of the situation and see what people have to say on the matter.
JUNO airdrop.
To understand exactly what is going on with this proposal, you have to go back in time to the birth of the project itself. The JUNO chain launched with a large airdrop, with a significant portion of the tokens dropped to ATOM holders. The snapshot for this drop was the ATOM upgrade around 12 months ago, which was also the base for the Osmosis drop and others. Certainly holding ATOM at that time has been very lucrative for many.
When the airdrop took place, part of its composition was a "whale cap" of 50,000 JUNO. So, the most that any one entity was meant to get was 50K. However, a short time after the drop was distributed, and the chain came to life, numerous wallets transferred 50K JUNO each all into one wallet. It became apparent to the community that the airdrop had been gamed. This whale had large amounts of ATOM spread across a number of wallets, and ended up qualifying for multiple airdrops.
As you can see currently, this whale holds over 3.1 million JUNO worth around $120,000,000 currently. Looking at the wallets activities, it is clear that it is regularly claiming and selling all its staking rewards, worth around $250,000 per day. From following a chain of TX's and IBC transfers, it appears these rewards are being traded back into ATOM, with some at least being staked.
Proposal 4.
Back in October last year, a proposal was put out to correct this distribution, with Prop 4 submitted. At the time, information came out from the whale claiming that the ATOM funds were being managed by them as part of an investment fund, that they had no intention to game it and where not aware that the drop would be whale capped, and they where committed to acting in the best interests of the chain. That proposal was voted down, so the whale got to keep all their tokens.
Proposal 16.
Now the issue has re-emerged, and Prop 16 is on the table and open for voting. This prop has the support of Core-1, the team behind JUNO. So far, early voting looks like there is strong support for the proposal. Over 56% of stake has already voted, with 91% of the votes being yes. Many validators have posted on twitter with details of how they have voted, and why. For those not familiar with how votes go in Cosmos eco-system chains, people stake to validators. When a validator votes, the full amount of stake they have delegated gets voted that way, however, individual stakers can overrule that vote by making their own. So, in this case it seems that the vast majority of validators are in favor of this prop.
My thoughts.
This is an interesting one, and I can see both sides of the argument. On one side is the fact that the outcome of the airdrop was not as intended, and couldn't be fixed at the time. In hindsight, one whale gained an unfair advantage in the distribution and this prop aims to rectify that. The whale has a significant portion of the stake, and their choices could harm the JUNO eco-system, if they wished.
It is my understanding that this airdrop was not gamed intentionally. The whale in question seems to have set up numerous wallets (50 it seems) each holding 50,000 ATOM way before any airdrop was even hinted at, way before any snapshots occurred, way before even the Cosmos upgrade that was the source of the snapshot had even been developed. The gaming of the drop was not intentional, it was simply a byproduct of how this particular whale managed their funds.
Following on with these discussions, I am having flashbacks to the for that created HIVE, in which some specific wallets (Justin SUN and his supporters) had their wallets zeroed on the fork chain (HIVE). This case however has a major difference, in that a fork is not occurring, the chain is simply proposed to be upgraded to enable a shift of most of this whales funds into the community pool.
Removing well over 100 million dollars of someone's funds is a major precedent, and one that deserves the level of discussion and debate that is currently going on.
For what it is worth, I am leaning towards voting no with my insignificant stake of JUNO. The whale did not set up their wallets with the intention of gaming the drop. I am very conflicted on this decision however, and fully understand and can appreciate the community push towards a yes vote. Is the immutability of a chain something that is open to governance voting? I guess it seems to be, given the way this vote is happening.
Like I said, I am very conflicted, and understand both sides of the argument.
What do you think?
JK.
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And what would they have done if the whale hadn't tipped their hand and consolidated all the money into a single wallet? lol... silly
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Probably would have been non the wiser. It seems the whale stuffed up big time by consolidating their drop.
No real win here regardless of which way the vote goes.
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Distribute stupid airdrops and win stupid prizes... There are many valid reasons why projects don't disclose their airdrop eligibility before the drop actually happens.
I saw the outrage for this one on Twitter today and it's hard to sympathize with the people that want to pass this proposal. I also saw some posts comparing it to the Steemit takeover but they are two very different cases.
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comparing it to the hostile takeover is a bit silly on multiple front
The way in that they are similar is that both attacks are Sybil attacks, where the bad-actor pretends to be multiple people.
Still when you set up an airdrop like that, that can get Sybil attacked in the most obvious and stupidest way possible: you get what you deserve. There is no valid solution to this problem. Both options are terrible options.
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No valid solution indeed. Just surprised they didn't learn a lesson from all other Sybil attacks that gamed numerous airdrops in the past.
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Does the character of the whale change things? In this case, it seems that they made a lot of their ATOM from running Ponzi's and scamming people out of seed phrases in discord. All allegations, I have not seen proof of this to be fair.
This whole situation highlights the risks involved with large airdrops, they can have unintended consequences.
I wonder if the community would have such an appetite for airdrops if the had to KYC for them?
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Hardly. No one is saying that what they did isn't a very shitty thing to do but that's blockchain for you. If you designed the system badly and someone exploited it the fault is always on you, not on the bad actor.
While it sounds crazy for airdrops like this one there is no other way for now. Either KYC everyone or deal with the consequences later.
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Agreed, I do not really understand the comparison to the Steem HardFork.
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Right ... I found this post disturbing @jk6276, although I will quickly add all I know about it is from reading your post. I have no "dog in the fight." I do not own any JUNO ...
At the end of the day, I remind myself regularly that all of these "virtual worlds" are simply software. Running on computers. Tied together in a global network we call the Internet ...
Software can be changed at any time. To claim it is "immutable" is ... Simply not truthful. More accurately, we can state that we hope it will remain "immutable" by the "powers that be," who have "sworn" they will not "vote" in acting in any way that would undermine this core principle of this new asset class.
But ... Apparently the JUNO community has decided to vote on making an exception. Where someone has $100 million at stake!? Good grief ... Not a "good look" from my perspective ...
Overall, this is one more example of what I deem to be the "Achilles heel" of all of my own investing in this asset class. The constant efforts to "game the system," by those who have the skills to do so. With their "I win / you lose" intentions ... Their actions cause you (and others) loss? 🤷♂️ Hmmmm, too bad! "What are you going to do about it?" 🤷♂️🤷♂️
Not done yet ... 😉 Having years of "political activism" experience, I have a view of voting that differs from many. I do not favor "herding people to the polls" to vote, when I know how poorly informed most people are. They simply will not exercise their responsibility to be well-informed. The results speak for themselves. We would be far better off if people would simply stay home, rather than vote on something where their decision is based on "30-second sound bites" slanted in one way or another ...
And even that is based upon hoping the voting mechanics have not been "gamed" to "cheat" ...
At least on the latter point, I think blockchain voting seems pretty "bulletproof." So it is down to the "masses" voting, when they do not know enough about it ... I will look forward to reading your future post about how all of this turns out.
P.S. On even the hint of my $100 million being "stolen," I would move it ... Not sure what is keeping this whale from "voting" that way himself (herself?, themselves?)?
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Does the character of the whale matter?
There are allegations from JUNO founder that the whale in question has made a lot of their ATOM through scams and bad behavior - scamming people out of their seed phrase on discord for example, and running actual Ponzi's.
As to moving the funds, the are staked with a 28 day unbonding. This prop will be done and chain "upgraded" by then. They have been dumping their staking rewards daily for a while, have already made a fortune from these tokens, regardless of whether they get to keep them.
I agree, to a point. Are not also these virtual worlds also communities with a governance say?
I'm playing devils advocate here, trying to firm up my position. Still can't quite find the "black and white" solution, all I see is lots of grey.
It is an interesting one.
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Certainly, but ... Key word for me, in what you have written? "Allegations" ...
In America, we are supposed to be innocent until proven guilty. With a prosecutor presenting evidence that you are, then a jury of your peers gets to decide your fate ...
Nothing like that exists "in here." Allegations can be recklessly asserted, with those generating them knowing nothing can ever be proven ...
My own devil's advocate point, for your thinking through what you will do ...
That said, I have read about start-ups that are totally devoted to "blockchain analysis." Using automated tools to "track down" whatever ... Since this person's public key is known, then in the right hands, it should be possible to build quite a history of activity linked to it. Maybe that is what the JUNO founder is alluding to ...
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This sure is an intriguing situation, but I would lean toward a yes. To be frank if the atom holder was true to his word he should accept only 50k Juno to maintain sustainability on Juno. Whether or not it was fair he has enough ATOM to earn him plenty, and 50k Juno is no laughing matter.
What bothers me is if he or they are not aware of the air drop at 50k ATOM staked then why all of a sudden merge the JUNOS together when the ATOMs were in separate wallets? The holder probably would have win win if they just left the JUNOs in those 50+ wallets and just have to claim multiple times.
Yes, it is sus that they had 50 (at least wallets) each with 50K ATOM, which conveniently turned out to be exactly the whale cap for the airdrop. They really do seem to have stuffed up by combining the stake in one wallet. Also, the timing of that appears to have been strategic, waiting till after JUNO had been listed on Osmosis and trading meant the chain could not simply be relaunched/rolled back.
On the flip side, if governance decides it is happy to zero (well 50k actually) a wallet for this reason, what other reasons may they consider in the future to be valid?
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I first learned about this from @forexbrokr on this post. My take is that this is all the fault of how the airdrop was conducted and the developers of JUNO should take responsibility rather than taking funds away from some whale. This is not different from communists plundering the wealth of rich. Today it could be 100 million. What about tomorrow?
If JUNO thinks whales are a problem, they should fork like Telos did from EOS: https://medium.com/telos-foundation/introducing-tlos-the-telos-token-d6af451e161f
The whale is not responsible for the faults of the developers. If the developers don't like the situation, do what Ethereum did (or what HIVE did). I'm not onboard with stealing funds.
!PIZZA
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As more details have come out since this article, it seems more and more likely that the sybil attack was not planned. Seems that the whale manages a large amount of ATOM on behalf of numerous Japanese private investors they have brought in to crypto. These investors seem happy, but the whale has chosen to keep the airdrops they have received for themselves rather than passing them on to the investors.
I'm still a no vote, as I feel that old saying of "two wrongs don't make a right" applies - The airdrop should have been passed on, but it also should have been designed better in the first place.
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I am also voting NO on this.
This is not the Whale's fault.
Nothing more to say.
I side on the fact if they take the funds away it is pure theft.
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Yeah, theft is theft, regardless of the nature of the person being stolen from.
I've wavered a lot, but am sticking with the no vote also.
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Looks like I'll unstake my JUNO... and move on. This won't end well either way.
I'm no whale, but yeah, downsizing my position a little. Stealing funds from a wallet is a bad look, regardless of the circumstances. A fork, like Steem/hive or ETH/ETH classic feels like a better option.
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If they can reach consensus to reallocate funds, they can do it again in the future, they should have done a better job with the airdrop.
They should move forward, but I don't hold JUNO, so it is a reaction more than a position and very much influenced by the steem, hive drama.
Never fool around with people's wallets if you want to be trusted.
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Yeah, my first reaction seeing the proposal was, "hang on, I thought blockchains were meant to be immutable". If they can vote away someone's funds once, they can do it again.
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Sounds like a project that needs to die lol They jacked up this one on many levels. People need to stop crying though and running to others to fix their issues. With Crypto it's a free for all either get smart or die and that's what I love about it! No government to bail you out, no person to bail you out just a harsh lesson if you jack up.
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It isn't a good look, but as you say, this is the wild west still and the whale stuffed up by revealing themselves and consolidating funds.
But taking them via a vote away... A step too far I think. Should have designed the airdrop better.
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What a dicey situation for the chain. It is def wrong to take anyone’s funds especially for the reason that they earned the funds legitimately.
This doesn’t relate to Steems story at all cuz JS bought Steem from Ned, Steem that was meant for development from the beginning, it was wrong and a malicious move, also, given the threat he posed to the chain, the chain was right to fork him out.
But this thing Juno wants to do is different. It’s bullying. The Whale hasn’t even posed any major threat to the chain. What if the whale starts to massively dump all his holdings on them by seeing their plans? It’s just uncool.
There should be ways to communicate and come to a bearable resolution for both parties but taking out someone’s funds is just somehow.
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I see your points but I maybe missing something here. How come the holder/s of all those wallets seemingly moved all the JUNOs into one wallet when they split the ATOMs evenly in the wallet?
It certainly is awful to lose one's funds just because they hold too much, but its sort of relative here. If one person held most of the world's BTC I wouldn't think it would have the same value as it has currently. Same goes for JUNO where if the whale truly wanted to support the platform would give back most of the JUNO airdropped.
It seems to me that the whales mistake was shifting all the funds into one wallet. Would this debate be happening if they kept funds separate?
On the flip side, anyone with 2.5 million ATOM has done quite well over the last year, with or without this JUNO.
What if people wanted to "upgrade" Bitcoin to remove Satoshi's wallet? He mined lots before most others knew about it, and if that wallet became active and started selling, it would threaten the value of BTC massively.
Interesting moral dilemma here, thanks for your contributions.
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The JUNO whale appears more likely to have gamed the airdrop then not and there lies the concerns. Satoshi holding so much BTC is like the whale holding his ATOM. Bought or earned it. Now an airdrop intended to distribute fairly to all atom stackers its origin is different. Like if we airdrop JUNO to all btc holders 1 BTC for 1 JUNO I don’t think Satoshi is going to split his BTC into multiple 50k wallets to game the JUNO airdrop. But if he did that it will raise red flag because intention was to distribute JUNO in a specific way. Someone gamed it and got caught. The lesson here is don’t move all the Juno into one wallet to direct suspicion. The more I just think about it the more I feel this wasn’t just luck playing a role to it but the whale planned it and acted innocently. Innocent before proven guilty? Let the voters decide.
Wallets where established well before any drop was on the cards. snapshot was in feb 21, drop was announced in aug 21, chain launched in oct 21. Most of these wallets were funded in 2020, way before any drops even hinted at. Seems not deliberately gamed, just lucky.
Having said that, does the character of the whale change things? It is alleged they gained their ATOM's via running Ponzi's and scaming peoples seed's on discord or telegram. I have seen these allegations, but no firm evidence. But it seems likely.
Definitely more research into the wallets, and some on chain analysis should have gone into the whale wallets prior to the drop.
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Just because they were way ahead of the announcement still doesn't prove they didn't know. Common sense makes me think otherwise. Why 50k, why not 25k or even less. Then there is the fact that they combined the JUNO to one account to collect all the airdrops in one shot. How convenient is it not? Sorry to keep pressing on the items with no additional updates on my part. I just feel its too many things aligning together making it very suspicious.
Lol I don’t know too. Perhaps shouldn’t have, then this drama would have been avoided.
This is the most amicable way to solve this problem. They should have this discussion and come to a mid point. Rather than threatening to take somebody’s funds. It’s just not a good look
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Yes, a compromise would have been preferable, undoubtedly. It seems that to some of those in the know, they may have an idea of the activities of the whale, and are considering them a bad actor. I dunno, still conflicted on what to think.
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I get that its a different situation to STEEM, and also thinking further back, ETH/ETH classic. As to threat to the chain... The whale has over 10% of supply, significant influence over validator positions, and is dumping vast amounts of JUNO every day.
I'm still thinking a no vote. (don't take the money)
But I dunno, it's a tough call.
I appreciate your input.
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The only way that I could support this proposal would be if it was shown that the whale had intentionally split funds and moved assets to gain the system.
If he already had the funds sitting there in separate wallets long before the airdrop was mentioned then imo it was a badly designed airdrop to not have this considered by the development team. It's not his fault that they didn't plan for this and while he could return some of the funds to the community pool in a show of good will. He was given the funds by smart contract and they are now his.
It's not in the spirit of the airdrop but its in the planning.
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It seems the wallets where set up that way well before any any signs of an airdrop where around. However, they didn't notify their situation either. Then they waited till after a DEX listing on Osmosis before they moved funds into one wallet. It was only at that point that people realized the wallets were connected.
It also is alleged (not by me, I have no idea) that they mislead the community during a previous push to rectify this situation, deceiving about the circumstances of their holdings.
Overall, it seems a really grey area for me, and while I have currently voted NO, I really do also understand the YES case.
Thanks for contributing.
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It's not an easy situation and I don't have a horse in the race so it doesn't affect me personally but I don't like the idea of taking a persons stake as it sets a very bad precedent.
I can see some of the arguments for yes as well but since I don't have all of the facts I can only go off my initial reaction. Forking out funds is theft to me.
It will be interesting to watch this play out as a community and where they go with it.
If the funds being taken where acquired through bad actions, does that change the thinking?
It seems the ATOM's that the whale had may have come from some shady places - scams, running ponzis and such. Don't know, still conflicted.
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I would blame the person who has designed the airdrop. It was stupid IMO. But the blame won't fix this valid problem. One entity could harm the ecosystem easily. Also, forking out someone's stake is the worst thing you can do for whatever reason unless you are absolutely sure that that person has evil intentions. It's a huge mess!
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The design of the airdrop was flawed, no doubt. But it was not known at the time that these wallets were all connected. This centralization of over 10% of the chain in one wallet was not an intended or foreseen outcome.
But messing with someone's balance, via governance is a choice I'd be very hesitant to make.
Voting NO for now, but the YES argument makes sense.
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It's fucked up the proposal is even being considered.
If a project set up an airdrop that gives an outcome they don't want then fix it before the airdrop. The time to think around the problem was long ago and they should have to accept what happened even if they don't like it.
That is my initial thinking also. But I do get the push from seemingly the majority of the community to correct the mistakes of the airdrop. The argument against "fix it before the drop" is that it was not known that the 50 wallets where connected, until well after the fact. The whale waited a while, till the chain was running and JUNO had been listed on Osmosis before moving all the JUNO into one wallet, drawing attention.
Also, claims they made when an initial push was made to remove most of the stake were seemingly misleading.
I get the black and white thought process here, but I can also see a lot of grey areas.
It's interesting for sure.
Thanks for your input.
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Thank you for bringing me this information as I have not been paying attention to JUNO lately.
As you said there are 2 sides of the argument and I honestly cannot decide which one is more legitimate.
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I've personally settled on NO, but the YES vote is well ahead. It is what it is, but the biggest thing I take away is that JUNO community is very passionate, and this vote has over 80% participation - that is a lot more than most elections (except here in Australia where we have compulsory voting).
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Seems like the Hive community feels the same for the most part that I do. I voted no because it's not right to take someone's assets period... Did they game the airdrop system, maybe, but hey, regardless, that's the way the game is played.
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There is just one thing I know for sure, if I had millions of ATOM tokens, I'd for sure have them spread across multiple wallets.
Imagine, aside from all these current shenanigans, having that much crypto. Would be nice.
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That’s why I said bravo to him, lol.
It is a dangerous precedent to set. This is what forked ETH and ETC... albeit the popular chain in this instance did mess with funds. That said, someone putting that much sell pressure daily is not doing any service to the protocol. I'm not sure which way I would lean on this one.
I wouldn't wanna be the deciding vote!
Yeah, I am kinda glad my little stake (in the context) doesn't make much difference. Watching the debates and accusations flying around the community on twitter is interesting. Certainly a passionate and committed community.
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Chains are forked because of the fundamentals that are being tested by issues like this, it is a really big deal for any chain to be forced to decide on something like this. That said, a stake based vote is far better than some central authority unilaterally deciding to freeze accounts. Go crypto!
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very interesting
Yeah its a fairly unique situation. The chain has no VC or centralizing entities (aside from the dev fund really, and this wallet).
But if a vote can alter people's token balance, it begs the questions around censorship, and immutability of the chain.
sure is interesting.
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According to your post everything seems to be right..
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Thank you.
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Interesting.
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