It’s not every day that the DAO approves a multi-year, $40 million protocol spend on a sports sponsorship. This week, Terra owners have been voting on just that, in what appears to be a first-of-its-kind event.
Do Kwon, creator of Terraform Labs, proposed a new five-year, $38.5 million sponsorship with an undisclosed team in one of America’s “big four” sports leagues (MLB, NBA, NFL, NHL).
No DAO (or similarly constituted body) has a collective vote to engage in sports sponsorship.
The proposition is the second of three key announcements made as part of Terra’s most recent campaign.
Terra and Its Three Serialized Announcements
Terra’s ‘Luna Foundation Guard,’ or LFG, announces a few weeks ago as the first of three parts.
LFG dedicates to a new non-profit developing the Terra ecosystem and strengthening sustainability. As well as the stability of Terra’s algorithmic stablecoins.
That the premier decentralized stablecoin machine has secured such high-profile sponsorship is emblematic of a bigger “DeFi to the public” movement.
The second is the notion that being courageous is primarily for the purpose of advancement. The third rationale perhaps articulate best in the proposal itself: “stimulating DAO governance inventiveness to fulfill its full potential.”
The NBA is the most likely destination, followed by MLB and NHL. With the NFL having a non-zero but low possibility of showing the traded team.
Discussion on Decentralization
On the other hand, the Terra network and Terraform Labs team disagree on the degree of centralization.
Do Kwon and the Terraform Labs team doxxed, giving the community reason to believe Kwon’s ideal of full decentralization is well on its way?
On the other hand, Kwon has hypothesized a “killswitch” that can completely decentralize the Terra ecosystem without Terraform Labs’ involvement.
When that mode engages, any remaining monies in the TFL wallet will be burned. It will be interesting to monitor how actions like this one affect Terra’s decentralization over time.
