Risk Labs, the foundation behind major crypto protocols, has proposed transforming the governance of its Across Protocol bridge. The plan involves converting the protocol from a decentralized autonomous organization (DAO) governed by the ACX token to a private company. This move, outlined in a proposal, follows founder Hart Lambur’s statement that “Having a token generally hurts more than it helps.” The proposal offers ACX holders shares in the new company or a cash buyout, leading to a sharp price increase for the token.
Risk Labs has proposed shifting governance of the Across Protocol bridge from a decentralized autonomous organization to a private company. This protocol allows users to move crypto between otherwise siloed blockchains and was the fourth-largest bridge by user deposits.
Founder Hart Lambur explained the reasoning succinctly on Wednesday. “Having a token generally hurts more than it helps,” he wrote on social media. Investors who hold the ACX token currently govern Across.
The proposal suggests creating a private company and converting investors’ tokens into shares. Alternatively, Risk Labs could buy out ACX holders uninterested in shares. The move comes as DAOs face a crisis of confidence marked by low engagement and controversy.
Most recently, the DAO managing Aave, the world’s largest decentralized finance protocol, saw months of bitter infighting. The proposal stated the token-centric model has prevented Across from striking deals with other companies. Transitioning to a legal entity would improve its ability to enter contracts and structure revenue agreements.
The value of ACX doubled after the proposal’s publication, jumping to over six cents per token. Lambur said the shift would allow Across to focus on stablecoins and artificial intelligence. According to the plan, tokenholders could exchange tokens for shares on a one-to-one basis.
That option would be limited to holders with more than 5 million ACX tokens, worth about $30,000 on Wednesday evening. Other qualified U.S. and international investors could swap through a special-purpose vehicle. Holders not meeting the criteria could sell tokens for four cents each, a 25% premium to the pre-proposal price.
