Uniswap Delegate Pepo Rage-Quits the DAO, Calling Out the Uniswap Foundation for Turning Decentralized Governance into a Top-Down Farce

A prominent crypto delegate at Uniswap known as Pepo has announced his departure from the DAO, blasting the Uniswap Foundation for what he described as a "power grab farce."

The move, which comes hot on the heels of the $165 million treasury grant to the Foundation, is sure to ignite further controversy at the DeFi platform.

Pepo, who controlled 455,000 UNI and ranked among the top 20 voting delegates, pulled no punches as he penned a blistering post on X.

In it, he accused the Foundation of systematically shutting out the voices of the DAO, ignoring the criticism of delegates and failing to engage in any meaningful way with feedback.

“The Foundation’s behavior over the past few months seems to have prioritized insulation over collaboration, and in doing so, may have actively harmed Uniswap,” Pepo wrote.

His departure is symbolic but also impactful. It’s a red flare fired over the bow of the $4 billion protocol, raising once again serious doubts about how decentralized Uniswap really is.

At the heart of the matter is the $165 million treasury grant that the DAO approved to the Foundation in March.

The funds are now being used by the Foundation with what some critics say is alarming autonomy.

Technically operating as a nonprofit, the Foundation is meant to serve the DAO. But some now argue it’s becoming its own power center, one that’s unaccountable and becoming increasingly aligned with Uniswap Labs, the for-profit entity that spawned the protocol.

“Delegate participation is essential to the success of the Uniswap ecosystem, and the @UniswapFND takes their feedback seriously,” wrote Devin Walsh, the Foundation’s Executive Director, in response to one user on X.

“In fact, we are the only major Protocol Foundation that is funded through the express approval of delegates. We were not endowed with tokens at the protocol launch.”

But despite these reassurances, several sources tell Blockware that key decisions are being discussed privately in back channels and on group chats, often with large wallet holders being brought into the loop long before anything reaches the eyes of community forums.

Several delegates describe it as a sort of “DAO theater,” where votes are held like a puppet show with the real calls having already been made.

This isn’t the first time decentralization at Uniswap has been questioned.

Last October, Stanford Blockchain Club’s Billy Gao slammed Uniswap Labs for launching its own blockchain without any input from the DAO, a move that Gao called a clear governance failure.

Even the formation of a new “Foundation Feedback Group” on May 1 has failed to quell rising tensions. Several delegates say it’s simply too little, too late.

“It’s a loss for any DAO when a delegate feels the only way to make an impact is through stepping down,” said PaperImperium from GFX Labs in comments to CoinDesk.

As UNI token holders ponder over who’s really steering the ship at Uniswap, one thing is clear: decentralization at the crypto behemoth is still very much a work in progress. And if the goal is to create a truly decentralized and community-driven Web3 protocol, then things will need to change quickly.