Polygon’s TVL has seen a sudden spike in the past 24 hours in a surprising turn of events. Now, although it surprised many, upon inspection, it was observed that this uptick was due to just one of its 200+ protocols – Balancer.
The decentralized exchange today closed its vote on a very important proposal, which affects the governance of the protocol.
Balancer needs a little balance
On February 24, a proposal to overhaul Balancer’s governance process was submitted. One was to fix the possibility of unfair support for a proposal from large BAL holders.
The proposal in question suggested that in future the Governing Council for Protocol will have the final say on whether or not the proposal merits and whether it should be adopted. However, the government council would have no voting rights.
This proposal may pass with flying colors after the vote ends today. At present, the proposal has over 39,000 votes, all 100% in favor of the proposal.
The optimism surrounding the proposition has resulted in a stunning increase in the total value locked on the dApp. Data from DeFi Llama showed that in 24 hours, TVL grew from $2.88 billion to $6.79 billion, an increase of 135%.
This was also reflected on Polygon, where the dApp is deployed, as its TVL increased by 97%.
Polygon, in particular, is preferred by smaller traders for decentralized exchange. Especially since on-chain data shows that the number of transactions below $100 topped 2.27 million and transactions worth less than $1,000 hit 2 million.
Larger cohorts involved in deals worth between $1,000 and $100,000, cumulatively, accounted for just over 832,000.
Here, it should also be pointed out that Balancer has a problem when it comes to investing as 87.33% of its 36.1k addresses suffer losses.
The protocol token, BAL, since its all-time high of $72 in May, has fallen 83% to trade at $12.1. For many, this can be seen as a barrier to attracting new investors. New proposals and a hike in TVL might do the trick, though.