ADA's value increase, potential sell-offs, risk for DReps?

Governance DRep Discussion
1

Screenshot 2024-11-16 at 11.28.15 AM
Screenshot 2024-11-16 at 11.28.15 AM2984×1478 396 KB

Disclaimer: This post has no relation with Price Analysis or Trading.

With ADA’s value trading below the previous ATH for years, it is quite obvious that some holders/investors would like to sell off their stake when their value target hits in order to recoup profits and probably hold back until ADA falls below 0.3 for re-entry.

If this happens;

  • Do we foresee a risk to DReps and the process, most especially in their voting power?
  • What would the impact even look like, something to worry about potentially?
  • How do we get holders to keep holding and delegating?
  • How fast should we think of rewards for delegators? Is it even feasible and/or sustainable?

Your thoughts are welcome!

2 Likes
2

I don’t see a real risk to DReps or threat to our governance model. I mean yes of course, people will lose voting power, but as long as the voting power is well distributed across DReps I don’t see a real distortion in governance or in the will of the people. We are a decentralized system, so voting power is expected to diminish in a good distribution among participants, right?

The exception would be Dreps with very few delegators, let’s say 5-10 addresses that decide to sell the majority of their stake. These Dreps could be impacted indeed.

2 Likes