Cross-chain DEX aggregator Velora has become the latest protocol to challenge the decentralized autonomous organization (DAO) versus Labs structure.
Today, April 10, Velora, formerly known as ParaSwap, adopted PIP-77: Governance Evolution & Operational Alignment, a proposal to wind down its DAO and consolidate operations under Laita Labs, the development company that built the protocol. The proposal passed with 65.8% of voters in favor and 16.78% against the shift. 17.41% of voters abstained.
The proposal transfers the approximately $415,000 remaining in the DAO coffers to Laita Labs to settle outstanding infrastructure costs. It also ends the DAO’s 20% protocol fee routing, stops the staking program with the exit lockup set to zero so that stakers can immediately withdraw, and closes the futarchy governance pilot with approximately $19,000 remaining of the original $50,000 allocation.
According to the proposal, VLR will become a governance-only token in the future, with Snapshot reserved for structural decisions such as token migrations, new on-chain deployments or activation of the annual coin mechanism of 2% of the contract. Meanwhile, protocol operations, infrastructure and revenue flow exclusively through Laita Labs.
Laita Labs framed the proposal as an alignment with existing realities: reward staking and fee routing had been inactive for months, board participation had declined, and the DAO had primarily functioned as an off-chain signaling layer while the development team kept the protocol running.
The proposal was not passed without community resistance. According to a Snapshot
Laita rejected all three, saying even a partial share “brings back the same complexity we are trying to get rid of.” Another community member, 12342, argued that the proposal “shifts the token from something that had a clear economic alignment with the success of the protocol, to a pure governance token with no direct value capture.” Supporter Citizen42 backed the team, calling it “not a sunset, it will be a sunrise.”
According to data from DefiLlama, Velora ranks eighth among DEX aggregators in 30-day volume of $2.06 billion, compared to category leader Jupiter’s $11.2 billion.
The vote comes as the DAO-versus-Labs governance model is showing cracks in DeFi. At Aave, a months-long dispute over the division of fees between token holders and Aave Labs led to an outright exodus of contributors. Chaos Labs became the third core contributor to leave Aave in two months, following BGD Labs and the Aave-Chan Initiative, all of which cited poor governance alignment.
At Balancer, a restructuring proposal published in March formalized the wind-down of Balancer Labs OÜ and consolidated all operations under a BVI entity operating as a direct agent of the DAO, downsizing the team and cutting the annual operating budget by 34%. Meanwhile, DAO governance platform Tally closed after six years, with its CEO citing reduced demand for DAO tooling as regulatory pressure eases.
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