Parrot Finance raised over $80 million in a public token sale during Solana’s heyday. However, the altcoin project is facing a redemption vote two years from now.
Critical vote for altcoin project, early investors worried!
The proposed redemption program aims to terminate Parrot’s management token PRT with more than $80 million from its treasury to be distributed among holders at $0.0045 per token. This price will greatly reduce the value of initial backers’ investments. Thus, it will cause them to recoup only one-tenth of their initial investment of $0.04 per token.
Critics say the team behind Parrot Finance could raise up to $60 million under the proposed redemption plan. It also claims to leave only $12 million to other investors. Commenting on the subject, a twitter user named Spreek shared the following allegations:
There was news of an error in governance today: the gopartyparrot team takes the remaining $72 million in ICO funds and tries to split $12 million into token holders and $60 million into teams. They also unlocked their tokens early and will vote regardless of what others say.
Today in governance was a mistake news: @gopartyparrot team takes their $72m remaining in ICO funds and attempts to split it $12m to the token holders, $60m to the team.
Oh they also early unlocked their tokens and will be voting it through regardless of what anybody else says pic.twitter.com/vmhDXJochQ
— Spreek (@spreekaway) July 21, 2023
There were mixed reactions to the proposal on social media. Looking at the answers given, a picture of a divided society emerges. Some investors see redemption as a necessary step to curb treasury mismanagement. Others consider it a robbery due to the significant loss in token value.
I think it is better to push for this than nothing, any kind of continual pushed on this could drag it on for months for holders
— Adonai (@Adonaieth) July 22, 2023
The majority of voters support the proposal, there are objections!
This has also raised concerns in the wider crypto community about the risks associated with funding projects through unregulated token offerings, especially with increased scrutiny from regulatory agencies such as the US Securities and Exchange Commission (SEC).
what annoys me is when projects like this lead to conclusions like “DAO governance doesn’t work”
if they have retarded token distributions, ability to unlock their tokens, don’t ship anything etc.
then they have little in common with real DAO’s
if a team wants to rug,…
— lito.eth (@litocoen) July 22, 2023
The proposal is currently open to voting and has six days left. However, many say the team has significant control over the PRT supply. So they claim to influence the vote in their favour. That’s why they are skeptical of the result. At the time of this writing, an overwhelming 97% of the votes were in favor of buyback.
However, the Parrot team disputed some of these claims. Accordingly, they made a statement on Twitter on July 22. The team stated that they did not touch or vote with the treasury tokens. He also argued that claims that they will make up to $60 million from the proposed token conversion are untrue.
https://twitter.com/0xrooter/status/168258486644825088
However, as you follow on Kriptokoin.com, the lack of a decentralized autonomous organization (DAO) has prevented token holders from participating in important decisions, despite the team’s protests. Therefore, it is also rumored that the team made major changes without official votes.
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