The governance members of Ren, a project that oversees a tokenized bitcoin called renBTC, voted to mint 180 million REN tokens ($10.8 million). They will be used as fresh capital to fund a new Ren 2.0 protocol after the collapse last month of Ren’s main backer, Alameda Research.
In November, the Ren team announced that it would shut down operations as a centrally run project — referred to as Ren 1.0 — because of funding issues.
Ren was acquired in February 2021 by Alameda, but its collapse removed Ren’s main source of financial support. The team then decided to wind down operations for its existing protocol (Ren 1.0) and replace it with a new community-run alternative (Ren 2.0), it said. To fund transition to the second version, the team requested new funding in the form of fresh REN tokens.
The Ren governance vote
On Dec. 15, the Ren team proposed to mint fresh tokens that would act as capital for the Ren 2.0 project. The Ren protocol put the proposal on the Snapshot platform to be voted on by governance members, or existing REN token holders.
As part of the now-approved vote, members were presented with four options for how many tokens to mint: 50 million, 100 million, 150 million or 200 million. There was also an option to reject the proposal.
In order for the proposal to pass, it required at least 51% of the voters to choose one of the first four options, before reaching its weighted average value from all votes combined.
Only 5.12% of voters rejected the proposal, according to data from Snapshot. The majority of voters, 80.78%, selected the option for 200 million tokens. A small portion of 1.08% voted in favor of 150 million tokens, 2.05% chose 100 million tokens and 10.97% were in favor of 50 million tokens. Using a weighted average of these results, it is estimated that 180 million Ren tokens will be created with a value of about $10.8 million at current market prices.
The approval of minting new tokens will be the first step for the Ren protocol team. With the mandate, the team plans to transition to a new version of the protocol. Still, making such a major change carries certain risks.
As the version 1.0 is retired, it’s possible that holders of wrapped bitcoin (generated with Ren) may not be able to recover their original bitcoin, the team warned. According to on-chain data, there’s still $12.5 million worth of renBTC that exists on Ethereum and is at risk of getting stuck.