On October 25, a proposal to split Kusama by 100 times was released, which was heatedly discussed by the Polkadot community at home and abroad.
Today, although this motion has been rejected, Kusama, as Polkadot’s test network, is one of the most important development methods of Polkadot’s ecology. The concepts, methods, and influences involved in the voting process still deserve our attention.
So, in this Kusama split 100 voting, what else is worth our attention? What are its effects? Why is this motion doomed to fail from the beginning?
Review Kusama No. 91 voting
On October 25th, a motion about splitting Kusama by 100 times aroused concern. This motion is Kusama No. 91.
The content of the proposal consists of 4 aspects.
1) The total issuance of KSMs will increase by 100 times, from about 10 million to about 1 billion; 2) KSM distribution balance will increase by 100 times, so that 1 KSM (old) will become 100 new KSMs; 3) KSMs The distribution of KSMs has not changed, and the holders of KSMs still have the same network shares as before the change; 4) The accuracy of KSM will change from 12 digits after the decimal point to 10 digits after the decimal point. The main benefit of this change is to avoid the use of decimals when dealing with KSM and to implement a simpler calculation system, the same as the Polkadot rename of DOT.
Among them, the most important and the one that most triggers community discussion is the increase in the number of KSM tokens from about 10 million to 1 billion.
Within one day after the proposal was put forward, until the evening of October 26, the attention was still very low. For example, only 3677KSM supported the proposal and 0KSM opposed it, and the proposal was displayed as “will be passed.”
Subsequently, at around 19:45 on October 26, the number of votes began to skyrocket. The number of support votes rose from a few thousand to 120,000, and the number of oppositions rose from 0 to 6,100. At this time, the voting status indicated that it would be rejected.
Since the voting mechanism adopted by the Kusama network is Super majority approval, that is, only the KSM that participates in the voting can pass the bill. That’s why we saw that the 3677KSM approved the proposal, but the 120,000 KSM approved it but was in a negative state. This is because the negative vote rose from 0 to 6,100.
At the same time that the voting participants surged, the price of KSM tokens began to surge simultaneously. From 19:00 to 22:00 on the 26th, the price of the currency rose from 27USDT to 38USDT, the highest increase of more than 40%.
Since then, this motion has been vetoed. As of 04:03:54 (+UTC) on November 2nd, the motion was voted down by approximately 390,000 votes in favor and 350,000 votes against it.
The above is the voting process of Kusama’s 100-fold resolution.
Although this motion has been rejected, the impact of voting governance is worthy of our attention.
The “possibility” behind Motion 91
What are the possibilities brought about by the 100-fold split of Bill 91? There are at least three aspects.
First, the impact of whether the voting result is passed or not.
If passed, it means that 1 KSM becomes 100 KSM, which has a huge impact on the price of KSM tokens. Taking DOT split 100 times as an example, in the process of splitting, the price of DOT tokens rose by leaps and bounds and eventually rose by as much as 200%.
Second, it affects the price trend of DOT tokens. Because DOT and KSM token prices are mutually beneficial.
Let’s take the 100 times DOT split on August 21, 2020 as an example. Even after the split, the currency price has indeed performed as expected, rising by 60% in one day. In the same period, the price of KSM nearly quadrupled.
In fact, the skyrocketing price of KSM tokens on the evening of October 26 also led to a surge in the price of DOT. The price rose from 4.3USDT to a maximum of 4.8USDT, breaking the pressure in one fell swoop. So KSM and DOT are mutually successful in terms of prices.
Currently, Polkadot Parachain 1.0 is about to be launched, the development of Parachain 2.0 is nearing completion, and the bidding module is on the way. When Parachain 2.0 and the bidding module are officially launched, Polkadot ecology will usher in the most important parachain bidding.
Since the parachain bidding also involves voting, the current KSM split voting is actually beneficial to the later parachain bidding process.
In summary, the proposal has many benefits by splitting 100 times the voting, including affecting the price trend of DOT, KSM, and favoring parachain auctions.
In fact, long before the start of the auction, the opinions of the big V in the overseas community were already doomed to split the vote.
The “debate” between Bruno Škvorc and ksmholder
In the discussion on October 12, the voices of overseas communities actually pointed out the results.
Take, for example, the dialogue between Bruno Škvorc and ksmholder between October 12th and October 25th, on the kusama.polkassembly.io website, about KSM splitting 100 times.
BrunoŠkvorc: If this is what most KSM holders want, it is not very opposed, but out of curiosity, why would you do this? Considering that the two networks (Kuasma and Polkadot) are separate entities at this point, what are the benefits for them if the total supply is the same?
ksmholder: Hi Bruno, actually I (I think there are many people like me who can’t get close to the Polkadot/Kusama ecosystem) would rather make Polkadot and Kusama more comparable. Kusama’s initial selling point was Polkadot’s Canary Network (test network). If a project bids for a slot in two networks, why are 10 KSMs used in the Parachain slot voting instead of 1000? DOT?
ksmholder: Moreover, it is easier for investors to compare. Suppose I participated in Moonbeam’s first parachain launch on Kusama and invested 10 KSM, but I had to invest 1000 DOT in Polkadot’s IPO for the same Moonbeam to obtain equal shares, which is a bit strange.
ksmholder: Therefore, I think it makes sense to revalue Kusama tokens at an equivalent value, just like what we did with Polkadot (split).
BrunoŠkvorc: I understand your point, but to be honest, I can’t support this, the only reason is that it “feels strange”. In my opinion, the confusion caused by changing currency values is much greater.
ksmholder: Hi Bruno, it seems strange that it may not be a good way to evaluate. I definitely think that since Kusama is marketed as Polkadot’s canary network, at least there should be monetary units with the same economic basis to make them more comparable. Of course, the governance-wise setting is divergent, which is perfect, but in a comparable view of the unit and some other key characteristics, the conceptual connection between the two networks is given. What do you need to support this idea?
BrunoŠkvorc: If most people agree, so will I. But I think this will cause too much confusion, and unless the public objects, I don’t think I will change my mind.
ksmholder: I read through the governance process, but on the technical side, how should I make recommendations in a formal and correct way? As a not-so-tech-savvy person, please guide me, thank you. I have read these documents, but I am not smart enough to connect these to the blockchain. But when I just followed https://kusama.polkassembly.io/referendum/52, I changed DOT to KSM.
ksmholder: Please start! https://polkascan.io/kusama/democracy/proposal/37
BrunoŠkvorc: Please remember that even if we discuss approval here, it is non-binding because we are just discussing it here. You should probably also discuss it in the chat, but nonetheless, it’s nice to post it.
in short. Ksmholder insists that since DOT is split 100 times, why doesn’t KSM split? It is stranger not to split. Under ksmholder’s repeated insistence, Bruno had to say that if most people agree, I will too. Bruno also stated that even if I express my approval here, it is not binding.
We saw an eager resolution to pass the resolution, but the Great God has always refused to support it. Some anxious KSM holders ksmholder.
In fact, it is not only Polkadot ecological expert Bruno Polka who is vetoing the proposal. In the discussion forum, most overseas KSM investors who expressed their opinions expressed their opposition to the 100-fold split of KSM.
In summary, the KSM split 100 times proposal was rejected, even though many KSM investors are eagerly looking forward to this split proposal to be passed. However, we still see the positive effects brought by KSM token holders when participating in the process of Proposal 91.
