"Forcibly" recast 70 billion CROs, and decentralized governance has become a joke?

Author: Fairy, ChainCatcher

Edited by: TB, ChainCatcher

“Tomorrow, Cronos’ market capitalization will rise from $2.5 billion to $8.5 billion, with just one vote, and that only requires one voter.”

This is a satirical comment by Sonic co-founder Andre Cronje on Cronos on the X platform, and a true portrayal of this controversial decision by the entire crypto community.

Yesterday, Cronos passed a controversial proposal - recasting 70 billion CRO tokens. Ironically, this batch of tokens was officially announced to be "permanently destroyed" as early as 2021, and the current circulation and supply of CROs is only 27.3 billion. This decision almost doubled the total supply of CROs instantly.

In addition, the voting process is full of doubts, and the project party's follow-up operations are even more intriguing. This article will analyze this farce in depth to see how "magic" it is.

" Resurrection " tokens rush ETF

Cronos is an EVM-compatible chain developed by Crypto.com. It aims to expand the DeFi ecosystem on a large scale, support developers to port applications of Ethereum and EVM-compatible chains, and reach Crypto.com's user base. In 2021, Cronos announced the destruction of 70 billion CRO tokens to reduce circulation supply and send a signal of long-term commitment to the market. However, four years later, this promise of "permanent destruction" was subverted.

On March 2, Cronos Labs proposed to reminisce these 70 billion CRO tokens, equivalent to 70% of the initial supply, to create a so-called "strategic reserve." If the proposal is passed, the total supply of CROs will instantly soar from 30 billion to 100 billion.

Cronos Labs has put on the cloak of a "magnificent blueprint" for this proposal, claiming that strategic reserves will be used to promote CRO adoption and plans to launch the world's first ETF created by token issuers -the CRO spot ETF. They painted an ambitious picture: connecting CROs into institutional liquidity pools through Cronos ETFs, accelerating their institutionalization process and striving to be among the top ten global cryptocurrencies in the market capitalization of cryptocurrencies.

Behind the scenes: Crypto.com controls 70-80% of the voting rights

During the two-week voting period, the number of votes supported was always slightly higher than the number of votes against, maintaining a delicate balance. However, because the turnout rate did not exceed the 33.4% threshold, the situation was once deadlocked.

Just at the critical moment when the vote was about to end, 335 million CRO tokens suddenly poured into the "support" camp, pushing the turnout to break through the legal threshold and significantly boosting the approval rating.

The final voting results were released: 61.18% supported, 17.61% opposed, 20.11% abstention, 0.11% rejected, and the total turnout rate reached 70.18%, far exceeding the minimum requirement. This dramatic reversal has put the entire community in greater doubt.

Source: Mintscan

According to UnChained, three independent sources revealed that the victory or defeat of the vote is actually in the hands of Crypto.com itself. The company operates a large verification node that controls 70-80% of the total voting rights, almost determining the final result.

" Placebo" to cover up the ears

After the vote was passed, Cronos proposed a new proposal to destroy 50 million CROs (only 0.07% of the newly minted tokens), claiming to continue the previous destruction plan. According to historical destruction records, Cronos will perform two periods of destruction each year, with 50 million CROs each period, totaling 100 million CROs per year.

This move is more like a farce of "hiding the ears and stealing the bell". A community member sarcastically said, "This is simply a slap in the face of all CRO holders. While they recast 70 billion CROs, they pretend to destroy 50 million. Want to use such small actions to appease the community?"

The collapse of trust is more fatal than token issuance

Cronos' decision this time is not only a damage to its own brand image, but also an impact on the core rules and consensus of the crypto industry. Sonic co-founder Andre Cronje pointed to the heart of the problem: “Market value is a meme; decentralization doesn’t matter until it becomes important; immutability doesn’t matter until it becomes important.”

If the rules can be tampered with at will, the promise will be useless. The crypto market has always been forgetful, but how many trust overdrafts can it withstand?