BarnBridge is the latest crypto project that found itself entangled in legal proceedings initiated by the US Securities and Exchange Commission (SEC). With potential financial penalties on the horizon, the project turned to its token holders.
The details of any specific order sent by the financial regulator have not been disclosed.
The DeFi protocol kicked off a voting process on October 10th, centered around a proposal to allow its creators – Tyler Ward and Troy Murray – the authority to take any required actions to ensure compliance with the directives of the SEC, among other things.
The voters unanimously voted in favor of the proposal, which also includes paying all disgorgement amounts required by the SEC’s potential demands and authorizing BarnBridge’s legal counsel, Douglas Park, to sign the final version of the order on behalf of the project.
Voters are also in favor of the Treasury to compensate all of Park’s invoices related to the investigation as well as to dispose of all tokens that it is permitted to sell and allow Ward and Murray to distribute them.
The latest DAO vote signals the founders’ intention to adhere to the requests of the regulator. Such a course of action essentially indicates a complete winding down of its operations.
BarnBridge describes itself as a platform that “offers interest rate swaps allowing for any variable yield to be swapped to a fixed rate.” However, several of its related products, such as liquidity pools, were halted in July to minimize the potential further legal liability after the SEC opened an investigation against it.
At that time, Park, who was elected as the legal counsel to BarnBridge DAO, said that the SEC’s investigation was “non-public” in nature. He had also said that all work on protocol-related products should be stopped immediately and that individuals should not be compensated for work they do for the DAO until further notice.
Since then, BarnBridge’s native token, BOND, lost nearly 50% of its value. Crypto exchange Coinbase subsequently suspended BOND’s trading on its platform in August.