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Fox Token: Crypto Trading Pioneer ShapeShift Set to Fully Decentralize

CryptocurrencyJul 19, 2021 12:30AM ET
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Fox Token: Crypto Trading Pioneer ShapeShift Set to Fully Decentralize

  • ShapeShift has taken tentative steps to shut down its operations and hand over the keys to a DAO.
  • The winding-up process is scheduled to take around 3-12 months and will include airdrops worth around $98 million.
  • Users that have used the ShapeShift platform at any point will be eligible to take part in the airdrop.
  • 32% of FOX tokens in circulation will be shared amongst ShapeShift staff, while 34% will be distributed to the community.

ShapeShift has announced that it will be closing its doors of operations in the coming months. The “radical” decision is part of a move to go all-in on decentralization, breaking the norm from what is generally applicable in the current climate.

The ship will be steered by a decentralized autonomous organization (DAO) that is made up of FOX token holders. The transition is expected to take a few months and will include the distribution of FOX tokens to the community, staff, and Foundation.

The Curtain Falls for ShapeShift

Popular cryptocurrency trading platform, ShapeShift has revealed the decision to cease operations as a company. The Denver-based firm will pass the baton to a DAO that is controlled by holders of the FOX token.

According to Erik Voorhees, CEO of the company, the winding-up process may take up to a year, and in the end the company will have “no employees, no bank accounts and no CEO.”

The move lines up with the desire to be fully decentralized and the decision of the protocol to close “its corporate entity sets it apart,” which can rightfully be called “true decentralization.” Firms in the industry usually leave behind a corporate entity to carve out a profit for the founders.

This is huge news for the cryptocurrency ecosystem as it could trigger mass migration towards large-scale decentralization. All eyes are on ShapeShift to see how well the transition process is carried out.

The Process

To ensure a smooth, seamless transition for the company, ShapeShift will be distributing $98 million worth of crypto to past users of the platform and other affiliated communities.

340 million of ShapeShift’s FOX token will be airdropped to all the previous users of the platform, which amounts to over 900,000 addresses. Users of other DeFi platforms can also participate in the airdrop as 120,000 addresses have been earmarked.

Users that have carried out 100+ trades on the platform are eligible to receive 8,500 FOX while KeepKey customers that have connected their KeepKey to ShapeShift are eligible to receive 250 FOX.

Users of Gitcoin, Aave, Compound, Uniswap, among others, are eligible to receive 200 FOX if they meet certain criteria.

32% of the FOX supply will be disbursed to staff, while 24% will be given to the ShapeShift DAO and 1.3% will be utilized by the company as it begins the process.

On The Flipside

  • The move to embrace true decentralization is setting a precedent, but the community is yet to see how well the arrangement works out.
  • It all hangs in the balance and, much like the flip of a coin, it could either become a massive success, or a disastrous failure.

What Does It All Mean?

For ShapeShift, this marks the end of its corporate existence and is the beginning of a community-owned crypto platform. The codebase of the protocol will be open-sourced, making it truly decentralized.

The success of this intrepid attempt by ShapeShift would inevitably lead to more protocols following suit. The equitable distribution of assets has been cited by cryptocurrency experts as a key factor for why the transition may be fluid.

Since the announcement, FOX has risen by well over 164% and is currently trading at $0.7881, while trading volume is up by a mind-boggling 295,073% as of the time of writing.

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Fox Token: Crypto Trading Pioneer ShapeShift Set to Fully Decentralize
 

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