Cronos blockchain to reissue 70 billion burned tokens from 2021 as controversial vote gets approved
Quick Take
- A governance proposal by Cronos to reissue 70 billion CRO tokens, previously burned in 2021, was approved.
- The approval will increase the supply of CRO tokens from 30 billion to its original cap of 100 billion.
A governance proposal by Cronos, a Layer 1 blockchain from crypto exchange Crypto.com, seeking to reissue 70 billion CRO tokens ($5.6 billion) previously burned in 2021, was approved on Monday.
The proposal’s approval means that the total supply of CRO tokens will return to its original cap of 100 billion, with the newly issued tokens allocated to a “strategic reserve wallet” and placed under a multi-year vesting schedule.
This comes as Crypto.com plans to file an exchange-traded fund application for CRO, aiming to tap into the growing institutional interest in crypto, according to the proposal.
From the voting data provided on Mintscan, it appears that independent validators largely opposed the proposal, but a few validators with significant token holdings tipped the scales.
A few validators with large CRO holdings dominated the vote. Source: Mintscan
This approval has been met with critical reactions. Critics cited a sudden surge of votes via 3.35 billion CRO tokens in the final moments of the voting period and labeled it a display of centralization.
Andre Cronje, co-founder of Sonic, commented sharply on the outcome. "Tomorrow Cronos goes from a $2.5 billion market cap to an $8.5 billion market cap with a single vote and all it needed was a single voter," said Cronje. "Decentralization doesn’t matter, until it does," he added.
The voting, which took place from March 2 to March 16, initially saw the yes votes surpass the no votes by a slight margin until the last day, and the proposal also struggled to meet the needed 33% quorum. However, an influx of votes in the final hours of the voting period pushed the participation from below the required quorum to a final turnout of over 70%. It's suspected that Crypto.com controls these validators.
The proposal passed with 62.1% voting yes, 17.6% voting no, 20.1% asking to abstain, and 0.11% vetoing.
An influx of votes in the final hours of the voting period. Source: Mintscan
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