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OpenChat to transfer control to community after $5.5 million 'decentralization sale'

Quick Take

  • OpenChat, an on-chain messaging app, raised more than $5.5 million in a community-driven crowdfunding sale.
  • The OpenChat team says the project will now be controlled by its community of chat token holders. 

OpenChat, an on-chain messaging platform based on the Internet Computer blockchain, will soon transfer control of the messaging app to a decentralized, token-based governance system via the Service Nervous System (SNS), its team said.

This comes shortly after the project raised more than $5.5 million in a crowdfunding sale conducted last week.

Its recent token sale, which had 2,375 participants, allowed them to buy OpenChat's native governance tokens to form a decentralized autonomous organization (DAO). After the sale, the OpenChat team said that the on-chain messaging platform will be owned and controlled by its community of chat token holders, not a centralized tech firm.

"OpenChat users can become consumers, shareholders, and decision-makers and actively decide the platform's future. For example, if the community accepts a proposal, including a code update, it will be implemented by the SNS automatically instead of a single entity making a unilateral decision," Matt Grogan, co-founder of OpenChat, said in an interview with The Block.

The newly raised funds from the token "decentralization sale" will be held in OpenChat's DAO treasury, and chat holders will decide how best to utilize them, the team said. The platform will allow users to vote directly on new proposals for upgrades, features, and treasury allocations via the Service Nervous System (SNS), a governance system model used on the Internet Computer.

“From now on, OpenChat will be owned and controlled by its community of chat token holders. The platform allows users to vote directly on new proposals for upgrades, features, and treasury allocations via a Service Nervous System (SNS) which provides an algorithmic DAO-like model," Grogan said.

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