Tornado Cash governance rejects plan to diversify treasury holdings

Quick Take

  • The vote was to sell vested native tokens held in the Tornado Cash treasury for ETH.
  • More than two-thirds of the voting power voted against the proposal.

A vote for Tornado Cash (TORN) — a coin mixing protocol for obscuring blockchain transaction history — to diversify its treasury holdings into ether (ETH) has failed. This comes as a lot of governance platforms continue to wrestle with the fact that their treasuries are declining rapidly.

The governance vote, which concluded on July 4, was a proposal to sell 50,000 of its vested native tokens (TORN-v-1) for ETH via a two-week limit order crowdsale on the decentralized exchange aggregator 1inch. This crowdsale would have been at a minimum of 0.008 ETH per token. As such, the platform would have raised at least $480,000 from the process if the vote had passed.

Since the tokens were vested, they can't be sold but they can be used to vote on governance decisions. As such, their sale would have seen buyers participate in the governance process. These tokens would have been locked up in governance for one year before they could be withdrawn at a 1:1 rate for TORN coins. Buyers would also have earned yield from staking during the vesting period.

Details from the voting page show that 68% of the participants were against the vote. Voter participation in the process was almost seven times the number required to achieve a quorum on Tornado Cash DAO, showing that there was a co