uniswap set a toxic precedent with how they split value between token and equity
their setup has the same flaw as a project launching multiple tokens: competing incentives
like, at least if pump split fees between equity and token, everyone rows in the same direction. but uniswap's equity and token are directly competitive. raising frontend fees can lower volume for the protocol, and vice versa. it's a bizarre structure
internal competition isn't uncommon at big companies. ipads compete with macs. but that's precisely why the profits are housed under one roof
the reason for splitting is pretty simple (and not regulatory): retain employees after TGE by promising their equity has value too. but the amount of energy spent on balancing token and equity value is wasteful at best and toxic at worst (see: friendtech)
there's nothing wrong with funding operations for development. it's the structure that's broken. diluting value between two assets is bad enough. but creating competing revenue streams is just value destructive
their setup has the same flaw as a project launching multiple tokens: competing incentives
like, at least if pump split fees between equity and token, everyone rows in the same direction. but uniswap's equity and token are directly competitive. raising frontend fees can lower volume for the protocol, and vice versa. it's a bizarre structure
internal competition isn't uncommon at big companies. ipads compete with macs. but that's precisely why the profits are housed under one roof
the reason for splitting is pretty simple (and not regulatory): retain employees after TGE by promising their equity has value too. but the amount of energy spent on balancing token and equity value is wasteful at best and toxic at worst (see: friendtech)
there's nothing wrong with funding operations for development. it's the structure that's broken. diluting value between two assets is bad enough. but creating competing revenue streams is just value destructive
impressive levels of having your cake and eating it too
https://x.com/kapursanat/status/1937685571377459243
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