Solana-based decentralized finance (DeFi) protocol Parrot.fi is voting on a proposal to phase out its PRT token and distribute the project’s treasury – once estimated at nearly $80 million – among token holders.
PRT holders would redeem their tokens at $0.0045 apiece, according to the proposal posted late Thursday. That redemption rate locks in a major loss for the earliest investors of Parrot Finance, a stablecoin issuer that attempted to build new kinds of crypto lending markets on the Solana blockchain.
Two years after its roll out, however, Parrot’s plans haven’t panned out. Its total value locked (TVL) places it in the lower tier of Solana DeFi and its token is well below sale price. Even as other protocols rally with user incentive mechanisms and liquid staking token integrations, Parrot’s TVL has gone sideways.
Parrot.fi raised $84.7 million when it sold 10% of all PRT tokens to the public in September and October 2021, at the height of that year’s bull run for Solana DeFi. Those tokens have since lost at least 88% of their value, according to Cryptorank. Meanwhile, the project’s treasury remains in the tens of millions.
The redemption plan appears to heavily favor employees and Parrot’s venture investors. Last November, Parrot finance unlocked all remaining team and VC tokens two years ahead of schedule. Community members claim the modified vesting schedule gives these insiders a redemption price of $0.055, 22% higher than the original, public investors.
Parrot team members did not respond to a request for comment.
At the conclusion of the redemption, Parrot protocol would sunset its token but continue to operate the protocol. Killing the token would render PRT holders powerless over the protocol. But that would be more of the same: Parrot’s never had a decentralized autonomous organization (DAO) despite leader PartyParrot’s early insistence that it would.
“The first proposal of DAO is to kill the Parrot 🤣 Hilarious,” the pseudonymous user Parachute, who has been in Parrot’s Discord server since October 2021, said in a public channel Friday.
At press time the vote was overwhelmingly in favor of conducting a buyback with 97% in favor. The vote is well below quorum; it is open for the next week. Some voters on ballot-casting website Realms blasted the early insider unlock for rendering the team “majority token holders, making this vote meaningless and a total farce.”
Parrot’s community in the Discord appeared split between open anger from long-term holders and begrudging acceptance from newcomers.
The pseudonymous Crypto_Boi, an investor who joined Parrot’s Discord months after its token sale and bought in when PRT was valued at $0.001, called the redemption “nothing short of a robbery” but was nonetheless in favor.
“It’s good that a redemption is happening, Because the team has done nothing of substance for the last year and a half and has been draining the treasury with their salaries,” Crypto_Boi said. “But they provide 0 results. So redemption is the only option.”
Sourced from cryptonews.net.
