Macauley Peterson

The v9 Lambda upgrade to the Cosmos Hub came off without a hitch shortly after 4:00 am ET on Wednesday.



The new software version, which has been in the works for over a year, enables a new kind of app chain to launch, one which doesn’t need to establish its own security through a unique validator set to establish consensus. The network would instead piggyback on the four-year-old <a href="https://blockworks.co/tag/cosmos" target="_blank" rel="noreferrer noopener">Cosmos</a> Hub and its 175 validators.



Cosmos Hub’s decentralized set of <a href="https://hub.cosmos.network/main/validators/overview.html" target="_blank" rel="noreferrer noopener">validators</a> worked in concert to briefly pause the chain and initiate Lambda at a predetermined <a href="https://www.mintscan.io/cosmos/blocks/14470501" target="_blank" rel="noreferrer noopener">block height</a>.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Lambda Upgrade is successfully completed ⚛️ Replicated Security is live on the Cosmos Hub!<a href="https://twitter.com/hashtag/Cosmonauts?src=hash&amp;ref_src=twsrc%5Etfw">#Cosmonauts</a> get ready for the next phase&#8230;  It’s time to onboard Consumer Chains! The dawn of the Atom Economic Zone begins today 🔥 <a href="https://t.co/4C2DcH2XC2">pic.twitter.com/4C2DcH2XC2</a>&mdash; Cosmos Hub ⚛️ (@cosmoshub) <a href="https://twitter.com/cosmoshub/status/1635917476331438080?ref_src=twsrc%5Etfw">March 15, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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Blockworks spoke to Avril Dutheil, who is managing the Neutron project, a smart contract platform which expects to go live in mid-April and make use of the hallmark feature of Lambda: interchain security (ICS), also known as replicated security.



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Blockworks: You’re the first project that’s actually going to be using ICS, is that right?



Avril Dutheil: We’re the first to have signaled our interest in interchain security, we’re the first to receive funding for doing so. We’re likely to be the first to launch on interchain security as well, but that kind of depends on governance.



Blockworks: How would you characterize the interchain security debut in the pantheon of Cosmos upgrades? Cosmos is marked by this very interesting political dynamic, oftentimes very tumultuous.



Avril Dutheil: To a large extent, I think this is actually a good sign. In political systems, we tend to say, democracy is de-census. You don’t have democracy if you don’t actually have conflict. It’s actually a good thing to see dissent to some extent.



In general, it’s been resolved in Cosmos when we get dissent, and it usually leads to stuff getting done in the end. I think the most recent example [was] the <a href="https://blockworks.co/news/cosmos-ecosystem-will-soon-vote-on-atom-2-0-revised-white-paper">Atom 2.0 white paper</a> and vision <a href="https://blockworks.co/news/no-with-veto-cosmos-community-rejects-atom-2-0-white-paper">getting rejected</a>. To me, it was a surprise that the proposal itself, which was just a signaling proposal, got rejected entirely.



But what’s actually more interesting to me now is that <a href="https://www.blockworksresearch.com/research/the-implications-of-atom-2-0" target="_blank" rel="noreferrer noopener">a lot of these ideas</a> are actually getting built, but by specific teams that form around the ideas. So, for example, the governance vision is getting built by the likes of <a href="https://docs.daodao.zone/docs/introduction/welcome-to-dao-dao" target="_blank" rel="noreferrer noopener">Dao Dao</a>, [which] is actually going to be deploying on Neutron as well.



The Allocator [to fund new projects] is following a similar pattern, and the Scheduler [which would manage block space] is also being picked up by another team that has been working on MEV in Cosmos since day one. Basically all the main ideas, perhaps except inflation — the initial large mint of ATOM tokens that was proposed in <a href="https://www.mintscan.io/cosmos/proposals/82" target="_blank" rel="noreferrer noopener">Prop 82</a> — are actually getting built, but in a more piecemeal approach, essentially.



Blockworks: Compared to what the original vision was, do you think [the piecemeal approach] will be better as a result?



Avril Dutheil: For the Allocator, the products and the way they should be built are much more straightforward. And so it’s more of a question of having a good understanding of exactly which market the primitives work in, which is somewhat different from other DeFi primitives because it’s catering more towards inter protocol, DAO-to-DAO or even institutional clientele rather than retail consumers, and so designing the product with this in mind will be important as well as having good engineers that can make it happen in a way that’s very secure.&nbsp;



This is also getting built with smart contracts within the Cosmos Hub economic zone. I also think this is a really good outcome, especially since the initial idea was for the Allocator to be released as a consumer chain that would be secured by replicated security.



The problem, in my opinion, is when it comes to the economic model of ICS, for the short and perhaps medium term, I don’t see ICS scaling to dozens and dozens of chains — because the revenue that it generates will take time to bootstrap, but the cost on validators is pretty much instant.



It’s tough to launch a new consumer chain until the validators roughly achieve breakeven on the previous ones, because otherwise you end up adding pressure onto the bottom of the set, and that can turn into a centralizing force over time.



Mitigating this effect — distributing stake more equitably, distributing the revenue in perhaps different ways to achieve breakeven fast — and then the potential for opting in or out of replicated security are all avenues that are being explored in order to make this economic model more friendly to the bottom of the validator set.&nbsp;



Blockworks: Where do you position Neutron among other longer-running smart contract platforms like <a href="https://blockworks.co/tag/juno" target="_blank" rel="noreferrer noopener">Juno</a> and Evmos?



Avril Dutheil: I think there’s a fundamental difference between the two which is that, traditionally in Cosmos — well, actually any smart contract platform — as an application builder I have to choose which feature set and which market I’m actually going to be operating in. So that means if I’m interested in privacy I’ll probably choose Secret Network because they have this feature, but I’ll also be constrained by the size of their market.&nbsp;



In Cosmos, you can have token transfer functions very easily even as a smart contract application, but interoperability beyond that point — at least until Neutron launches — is not a solved problem. You can’t use interchain accounts because they were designed and built with other Cosmos SDK modules in mind…and interchain queries aren’t a thing that’s available to smart contracts either. When we started building Neutron, they weren’t a thing at all — they were an idea.



[Neutron] flips the script of general smart contract platforms on its head, because when you opt to deploy on Neutron primarily, you’re not choosing to deploy only on Neutron, you know that — because of Neutron’s features which enable your protocol to interact with other chains — you’ll be able to leverage feature sets from their other blockchains.



For example, let&#8217;s say I want to do private voting or sealed auction bids for my DeFi protocol or its governance. I can route the votes or the trades through <a href="https://blockworks.co/tag/secret-network" target="_blank" rel="noreferrer noopener">Secret Network</a> or Penumbra in order to anonymize them or conceal them — meaning that, I can get access to the privacy feature without being deployed on a private chain. I can get access to high speed by onboarding <a href="https://blockworks.co/tag/sei-network" target="_blank" rel="noreferrer noopener">Sei [Network]</a> and having some of my protocol’s logic run on Sei and then route trades that require that feature through Sei. 



So there will be a market on Neutron, but there are also markets on Juno, on Secret Network, <a href="https://blockworks.co/tag/osmosis" target="_blank" rel="noreferrer noopener">Osmosis</a> and the others.



And rather than being siloed onto one of these markets and knowing that it’s going to be difficult and will require tremendous engineering work to be able to onboard these other markets, you know that comes right out of the box.



Blockworks: Would there be impediments to upgrading Juno along these same lines?



Avril Dutheil: It’s much easier to make changes to a blockchain before it’s live. That being said, eventually I believe these functions will also be present on other chains. The thing though is that there’s a lot of engineering work required to make it work…We had to code the solutions in a way that is to a large extent not compatible with another Cosmos SDK chain, so even adapting it would require quite a bit of time in terms of engineering.



Blockworks: The design philosophy sounds a bit like <a href="https://blockworks.co/tag/axelar">Axelar</a>. Is that a fair comparison?&nbsp;



Avril Dutheil: I think there’s a bit of that, for sure. I do believe we’re working towards the same direction. The main difference between Axelar and Neutron is the technological stack that we built our interoperability on. For Axelar they built their own bridge system which is dedicated to Axelar. It is flexible enough to bootstrap interoperability between numerous chains with very diverse ecosystems. In our case, we mostly rely on <a href="https://blockworks.co/tag/IBC">IBC</a> [Inter-blockchain Communication]…because we think that it is likely going to be the long-term winner in terms of the actual protocol that is used to make blockchains communicate.&nbsp;



The main advantage of IBC is that it does not introduce any additional trust assumptions. If you trust the blockchains that you’re interacting with, you can trust IBC because the relayers — the third parties that are actually making it work — don’t have the power to change anything as long as you have the <a href="https://www.blockworksresearch.com/glossary#light-client-node" target="_blank" rel="noreferrer noopener">light clients</a> on both sides.



And so that’s a very interesting design philosophy and it’s also point-to-point, rather than having one chain that connects everything else together which would then act as a centralized point of failure. With IBC you can actually have a much more diverse network topography.



There are limitations to IBC — the main one being that, while IBC runs fine in Cosmos SDK blockchains, in most other environments running light clients inside a virtual machine takes a lot of gas and computation to verify all of the proofs. And so currently it’s difficult to make it widely adopted.&nbsp;



Blockworks: Are you optimistic that the impediment to having IBC working with Ethereum are going to be resolved?



Avril Dutheil: I wouldn’t be surprised if we see that this year, or conservatively next year — I’m sure it will be in production, yes.



The interesting thing of IBC is it specifies very little, meaning you can build very diverse applications on top of it. It’s very flexible beyond just ordering and the structure of the very basic messages and how you connect two chains. Beyond this, the sky&#8217;s the limit in terms of the applications you can build on it.



When IBC expands to these other chains, then suddenly our infrastructure, in the same manner, expands to these other chains, meaning that it will most likely be possible in the future to control accounts on Ethereum from a smart contract on Neutron, and I don’t believe it will require too much engineering to actually make that happen, once IBC is there.



The interview has been edited for clarity and brevity.



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Q&A: Neutron Project Manager Talks Cosmos Interchain Security Upgrade

<div id="highlights-block_77f27d32dced49fc0370f496936568db" class="highlights">
 <ul>
 <li>The Terra Builders Alliance proposal calls for a “new luna” to be minted and distributed primarily to LUNA stakers prior to the depegging of UST</li>
 <li>Terra founder Do Kwon posted a revival plan of his own, calling for the abandonment of UST</li>
 </ul>
 
</div>



A group of dApp developers in the Terra ecosystem, calling themselves the “Terra Builders Alliance” have put forward a rough outline of a proposal to relaunch the project, “to honor existing UST holders, loyal Luna holders, and developers,” <a href="https://agora.terra.money/t/luna-go-forward-proposal/7136">according to a forum post</a>. Terra founder Do Kwon has weighed in to support a similar framework.



Other groups are considering moving apps built on the Terra chain over to other smart contract blockchains built using the same architecture.&nbsp;



The Terra Builders Alliance proposal, which has not yet been formally submitted to governance for a vote, calls for a “new luna” to be minted and distributed primarily to LUNA stakers prior to the depegging of UST, as well as those UST holders that remain so up until the new network launch. The normal governance system which relies on on-chain voting is <a href="https://station.terra.money/gov#PROPOSAL_STATUS_VOTING_PERIOD" target="_blank" rel="noreferrer noopener">flooded with proposals</a>, many of which have no votes yet, so it’s unclear how the community will achieve consensus on a course of action.



The proposal is the work of four prominent dApp developers on Terra — Nexus, Apollo, Astroport and Mars — however, notably absent from the list is Anchor, where the vast majority of economic value on the network is stored.



“Once the UST has been swapped with LUNA at the new network launch, it will cease to exist in its current form and will be relaunched after genesis in collateralized form,” the proposal states.



Unspecified is what, if any, role Terraform Labs and its CEO Do Kwon would play in this plan. A TFL spokesperson did not immediately reply to Blockworks&#8217; request for comment.



But Kwon subsequently posted <a href="https://agora.terra.money/t/terra-ecosystem-revival-plan/8701" target="_blank" rel="noreferrer noopener">a similar &#8220;revival plan&#8221;</a> of his own, calling for the abandonment of UST.



&#8220;While a decentralized economy does need decentralized money, UST has lost too much trust with its users to play the role,&#8221; Kwon said in the Terra forum post, adding, &#8220;while UST has been the central narrative of Terra’s growth story over the last year, the Terra ecosystem and its community is what is worth preserving.&#8221;



He calls for &#8220;reconstituting&#8221; the chain, resetting LUNA&#8217;s circulating supply and distributing it primarily to LUNA and UST holders prior to the depeg.



Aside from launching an entirely new network, the community may consider moving its work to another smart contract blockchain — <a href="https://cms.blockworks.co/?s=juno" target="_blank" rel="noreferrer noopener">Juno</a> — built using the Cosmos SDK, with dApps written in <a href="https://cosmwasm.com/" target="_blank" rel="noreferrer noopener">CosmWasm</a>, just like Terra. The leaders of Juno are <a href="https://twitter.com/wolfcontract/status/1524803188238561282" target="_blank" rel="noreferrer noopener">laying the groundwork</a> for a community fund that would encourage Terra’s many dApp developers to migrate their wares over.



Another Cosmos chain that could implement permissionless CosmWasm dApps is Osmosis, known primarily as the home of the largest decentralized exchange in the Cosmos ecosystem. Co-founder Sunny Aggarwal floated the idea on Thursday in <a href="https://twitter.com/sunnya97/status/1524811190425247749?s=20&amp;t=Dem9z9DYJxb2ocnO6qWmKg" target="_blank" rel="noreferrer noopener">an informal Twitter poll</a>, although early results indicate his followers are overwhelmingly against a change away from the chain&#8217;s current, “governance-gated” dApp strategy.



In the short term, there are countless stories surfacing on social media platforms of heartbreak and loss connected with this unprecedented and sudden collapse.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">3AM in Germany, almost one week passed since the first depeg of <a href="https://twitter.com/search?q=%24UST&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$UST</a>. How did time go by so quickly? Talked to so many people within the space during those days. We talked, we cried, we remembered great moments. Thanks everyone It’s life, we will move on. In &amp; outside of <a href="https://twitter.com/hashtag/web3?src=hash&amp;ref_src=twsrc%5Etfw">#web3</a>&mdash; danku_r (@danku_r) <a href="https://twitter.com/danku_r/status/1524920458205974528?ref_src=twsrc%5Etfw">May 13, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Community members are gathering <a href="https://www.reddit.com/r/terraluna/" target="_blank" rel="noreferrer noopener">in various forums</a> to share grief, counsel, and express anger and frustration.



Meanwhile, Do Kwon may also be fearing for his safety, <a href="https://news.mt.co.kr/mtview.php" target="_blank" rel="noreferrer noopener">according to local Korean media</a>, after a stranger rang the doorbell to his house, asked if he was home, and then fled.



In summation to his latest plan, he gave no sign of leaving the project and instead struck a hopeful note.



&#8220;The rallying cry for the Terra community has always been, &#8216;a decentralized economy needs decentralized money&#8217;. This is an exciting vision, and while UST has not been successful, the Terra community will find ways of iterating on the idea at some point in the future.&#8221;



This story was updated on May 13, 2022 at 1:28 p.m. ET.

What Comes Next for Terra Ecosystem?

<div id="highlights-block_eec3016a22b7dcde07607dcf874ead2e" class="highlights">
 <ul>
 <li>Proposal 20, which passed over the weekend, is expected to take effect on May 4</li>
 <li>Over 3 million JUNO tokens will be transferred to a community-controlled wallet</li>
 </ul>
 
</div>



Juno, a smart contract platform that runs on the Cosmos blockchain, is on the verge of resolving a two-month-old governance conundrum.



An upgrade, slated to be executed Wednesday, will strip some three million JUNO tokens from a single wallet, belonging to an organization alleged to have exploited a loophole in the token’s initial distribution.



Juno’s token was distributed to stakers of the native Cosmos asset ATOM, but the team implemented a 50,000 “whale cap” — and deliberately excluded centralized exchanges, such as Kraken and Binance, which offer staking services.



In March, 40% of token holders <a href="https://cms.blockworks.co/juno-network-stakeholders-to-decide-fate-of-whales-millions-in-a-crypto-first/" target="_blank" rel="noreferrer noopener">signaled their intent</a> to remove tokens that were distributed to a collection of wallets that were later determined to belong to a single entity, in contravention of the stakedrop rules.



On-chain sleuths <a href="https://wallet.keplr.app/#/juno/governance?detailId=4" target="_blank" rel="noreferrer noopener">discovered</a>, in October 2021, that multiple recipient wallets of the initial drop were pooled together, implying that they belonged to the same owner or organization.



But stripping the JUNO assets from the wallet was controversial.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Regardless of your take on it, <a href="https://twitter.com/hashtag/Prop16?src=hash&amp;ref_src=twsrc%5Etfw">#Prop16</a> should be a big wake up call. Politics is coming to a blockchain near you, and no chain or DAO will be immune. What&#39;s happened on Juno could happen on any chain (or DAO) with on-chain governance&#8230; a community can vote to change things.&mdash; Multichain Maximalist 🦇🔊⚛️🏴 (@JakeHartnell) <a href="https://twitter.com/JakeHartnell/status/1503224734258909184?ref_src=twsrc%5Etfw">March 14, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Some viewed the idea of confiscating tokens as a property rights violation of sorts. But centralization of governance power was broadly considered a risk to the long-term prospects of the whole platform.



The owner of the wallet in question <a href="https://gist.github.com/junowhale/f8b3e936cd85ef1501de3e372a10458e#about-juno-airdrop-and-prop4" target="_blank" rel="noreferrer noopener">came forward</a> to explain that they were a team that managed assets on behalf of clients. In the ensuing <a href="https://commonwealth.im/juno/discussion/4044-softwareupgradeproposal-stakedrop-remediation-for-gameccndebo" target="_blank" rel="noreferrer noopener">community discussion</a>, a new consensus emerged. The wallet had not gamed the airdrop, but was instead ineligible for the stakedrop on account of being a virtual currency exchange service.



Before any concrete action could take pace, the blockchain <a href="https://wallet.keplr.app/#/juno/governance?detailId=17" target="_blank" rel="noreferrer noopener">had to be upgraded</a> to allow Juno governance to execute smart contracts. Then, a subsequent proposal could implement the voter’s intent on-chain.



Meanwhile, the rogue entity, known as CCN, made <a href="https://wallet.keplr.app/#/juno/governance?detailId=18" target="_blank" rel="noreferrer noopener">a proposal of its own</a>, offering to split the funds equally with the DAO. It then <a href="https://twitter.com/wolfcontract/status/1514280496192278534" target="_blank" rel="noreferrer noopener">used its tokens</a> to vote in favor of the compromise. But the proposal was overwhelmingly rejected.



CCN <a href="https://wallet.keplr.app/#/juno/governance?detailId=19" target="_blank" rel="noreferrer noopener">tried once more</a>, offering to distribute the JUNO proportionally to its clients, following a know your customer (KYC) process from an independent auditor. That, too, was resoundingly defeated, with just 3.6% voting in favor.



The <a href="https://wallet.keplr.app/#/juno/governance?detailId=20" target="_blank" rel="noreferrer noopener">latest proposal</a>, 20, gave the community a vote on an upgrade that will remove CCN&#8217;s disproportionate token ownership and voting power. It passed April 29 with 71.2% of the vote.



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Juno’s DAO Votes To Confiscate $35M in Tokens From Whale in Messy Dispute

Jacquelyn Melinek

<div id="highlights-block_265c0c79e983282d327edc3de0c8788e" class="highlights">
 <ul>
 <li>If the whale abruptly pulled out their funds — currently worth about $122 million — they could single-handedly wipe out JUNO liquidity on decentralized exchanges</li>
 <li>The proposal, if passed, could set an “interesting” and “potentially dangerous” precedent, a community member named Kavaskous on Twitter said</li>
 </ul>
 
</div>



In less than 24 hours, thousands of Juno token stakeholders have banded together in a bid to correct perceived errors in the network’s stakedrop by confiscating one crypto whale’s token wealth. A stakedrop is a method of widely distributing tokens as a reward for staking the tokens of another blockchain or decentralized application.



Holders of the governance token of Juno, a layer-1 blockchain in the Cosmos ecosystem, are <a href="https://wallet.keplr.app/#/juno/governance?detailId=16" target="_blank" rel="noreferrer noopener">voting</a> on proposal #16 to reduce a whale address from over 2.5 million JUNO tokens to 50,000 tokens — removing over 98% — which would be placed in a community reserve fund. For reference, a whale is an entity or individual that owns a significant amount of tokens for a specific cryptocurrency. The move, according to the text of the proposal, comes after “numerous discussions with the community.”



The Juno Network launched with the full intention to be completely community driven, a community member TheJunonaut <a href="https://twitter.com/TheJunonaut/status/1501957396779855874?s=20&amp;t=eJ6QATBcRs-FN44TVTioPw" target="_blank" rel="noreferrer noopener">tweeted</a>. “Hence, $JUNO was distributed to $ATOM stakers via a 1:1 stakedrop with a hard whale cap of 50K as the community agreed to ensure fair distribution across the network,” they added.



At issue is whether the individual or entity in question deliberately circumvented the rules of the stakedrop by staking ATOM across dozens of wallets, thereby unfairly inflating its resulting stake in JUNO. The disparate wallets were subsequently consolidated into one.



Given the amount of tokens the whale now has, if they abruptly converted their JUNO to other assets, they could single-handedly wipe out liquidity on decentralized exchanges, resulting in a sharp decline in the JUNO price. But the concern among community members is not limited to their short-term financial interest. The asset concentration itself creates risks to on-chain governance by enabling the whale to potentially bribe validators — the guardians of network consensus — with delegations to serve the whales’ interests, a community <a href="https://gateway.ipfs.io/ipfs/Qmf3bGHiSiPTTNohNv4tBn5rvTChoQZNp8UDbGMxPq9HYC#Correcting-the-gamed-stakedrop---Proposed-by-Core-1-after-numerous-discussions-with-the-community" target="_blank" rel="noreferrer noopener">post</a> said.



“Proposals as a whole have flaws to them, but this proposal itself is super complicated,” Twitter user cryptolikemo said <a href="https://twitter.com/L1am_Crypto/status/1502316603177906178" target="_blank" rel="noreferrer noopener">during a Twitter Spaces</a> discussion, Friday.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“People are saying this is black and white, and saying, ‘yes is the obvious answer,’ and if you voted no, people are saying you’re evil.”
</blockquote>



It’s not clear that gaming the system was the whale’s explicit goal, however. The ATOM staking, required to be eligible for JUNO’s airdrop, must have occurred prior to Feb. 18, 2021, the date of an important <a href="https://stargate.cosmos.network/resources" target="_blank" rel="noreferrer noopener">Cosmos milestone</a> upgrade. But Juno’s stakedrop <a href="https://medium.com/@JunoNetwork/jun%C3%B8-tokenomics-and-utility-powering-the-worlds-first-fully-interoperable-smart-contract-ce9f490c4d97" target="_blank" rel="noreferrer noopener">was not announced</a> until July.



Regardless of the intent, not everyone agrees with the concept of redistributing wealth in this way.



“People who game airdrops deserve to keep their money,” George Wosmongton, a pseudonymous founder of <a href="https://cms.blockworks.co/?s=osmosis" target="_blank" rel="noreferrer noopener">Osmosis</a> Protocol, <a href="https://twitter.com/wosmongton/status/1502116226637524992?s=20&amp;t=pgZ6VJNQzjSZTyv36Uj-wQ" target="_blank" rel="noreferrer noopener">tweeted</a>. Wosmongton said holders should direct the blame toward the JUNO team instead of condemning the whale.



The wallet address in question currently has about <a href="https://www.mintscan.io/juno/account/juno1aeh8gqu9wr4u8ev6edlgfq03rcy6v5twfn0ja8" target="_blank" rel="noreferrer noopener">3.1 million JUNO tokens</a>, worth about $122 million as of Friday. The tokens are currently bonded, meaning they are staked to the network and are receiving additional rewards. Overall, about 28.77 million, or 38.5%, are bonded JUNO tokens, and 44.6 million, or 59.73%, are unbonded tokens, according to JunoScan <a href="https://junoscan.com/" target="_blank" rel="noreferrer noopener">data</a>.&nbsp;



Bonded tokens contribute to the security of delegated proof-of-stake networks such as Juno. In return for this commitment on the part of token holders — in this case, it takes 28 days for tokens to unbond — owners continuously earn rewards in the form of more tokens. By contrast, unbonded tokens are not locked, and an owner can transfer or exchange them at any time.



“If every day they’re getting 10% of staking rewards, that’s a lot of money,” cryptolikemo said. The whale was regularly selling a significant fraction of the staking rewards into the market, <a href="https://twitter.com/TheJunonaut/status/1501957438584475648" target="_blank" rel="noreferrer noopener">data shows</a>.



The proposal could be a first for the crypto community as it tries to redistribute the wealth of a major holder in the network. This gives some members pause, while others underline the urgency of the matter.



“Action needs to be taken quickly if the proposal goes through,” Liam Connor, Cosmos NFT YouTuber, said on the Twitter space meeting.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“If it takes three weeks to come up with a plan of action after, the whale will unbond and sell the tokens before we take the wallet.”
</blockquote>



Juno Network’s future is uncertain, and the situation may have broader implications for token governance and redistribution among crypto communities, cryptolikemo hinted.



If the proposal goes through, this could set an “interesting” and “potentially dangerous” precedent, Twitter user Kavaskous, who is also a crypto miner and ambassador and liquidity provider for Osmosis, said.



“If it’s executed without any problems [and] as long as this is a one-time thing, I think it’ll be fine in the long term, but if it gets repeated it could be slippery,” Kavaskous said.



Macauley Peterson contributed reporting for this story.



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