Sushi Swap Governance overhaul


Cease Kanpai 2.0 with immediate effect (ie before 19 December 2023). Commence direct democracy voting for all new implementations and proposals using the sushi token. Hold general elections on a new governing council for Sushi swap to draft and implement a decentralized charter for governance that supports the development of sushi swap as a DAO.


Since the inception of Kanpai 2.0 in December of 2022, the Sushi token has lost its primary purpose in capturing generated fees with 100% of fees taken now going to the treasury. In addition, the emission of sushi tokens has nearly completed with remaining emissions scheduled to end imminently (Nov/Dec 2023). Whilst this may have helped in ensuring that the treasury received funding, the token holders have lost a significant portion of their utility and governance has been lacklustre at best.

A review of tokenmics and forum discussions indicates a severe lack of community engagement and interest with limited new features or updates of note being implemented by the core team of Sushi since the inception of the Kanpai and the guaranteed funding resultant from that proposal.

Simple analytics suggest that the TVL on Sushi has declined from peak TVL from over $8B down to a current TVL under $400M. Whilst this may be understandable in a bear market, it has also seen a significant decline in the total fees, TVL and active users over the past 2 years, especially relative to peer competitors such as Uniswap, Balancer, Curve, Pancake swap etc. This has seen a relative decline from a top 5 DEX to 17th by trade volume (defi Llama links removed) and a decline in token price to essentially a flat line since mid 2022 (link removed) .

Many of these markers of poor relative performance may be as a result of the initial tokenomic weakness of sushi swap or a result of turbulent governance. However, the fact remains that this fork of Uniswap has lost a significant share of market attention and appears to have shifted further away from being a DAO, and more towards a treasury focused operation. It might not be too much of a stretch to say the primary purpose appears to be the protection of the core team and their salaries. This may be a reasonable goal, to protect the talent of the DAO, but with so few results and limited governance, the xSushi holders deserve much greater input.

The above statements may appear overly strong, but without a closer look behind the scenes and clarity on future designs, plans and options for the sushi token and the DEX, it is impossible to maintain blind faith in the team and what has been achieved so far. Instead, the true design imperatives of the DAO should be adhered to and the importance of token holder decisions needs to be centre most to the future of the DEX.


Allow the DAO to take ownership of their own destiny to capture greater market share, trade volume and new tokenomic designs. This can only be achieved through empowering Sushi token holders now that emissions are nearly complete, and allowing the DAO token to find its own true value based on the tokenomic design. This design must be decided upon and discussed by the DAO through the mechanism of the token holders.

Immediately cease Kanpai 2.0 and revert to the previous model with 100% of fees going to xSUSHI stakers.

Implement interim governance solution. Until a governing council can be established, all DAO activities are to be voted on using snapshot in a direct governance model. This will cease once a governing council has been elected and a more representative style of governance can be implemented.

No later than 30 November, post a vote to elect a new governing council of 7 members who will have the following responsibilities:

a. Establishing a new governing constitution

b. Publishing a state of the DAO to cover expenses and treasury

c. Publishing a roadmap for discussion on new tokenomic models.

d. Manage votes and snapshots and define criteria for when decisions need to be taken to vote or handled by the council.

This governing council will only serve for a total of 6 months to allow for rapid implementation of any new ideas and to ensure that sushi swap is best placed to make changes and adapt to the impending bull market.

Membership of the governing council:

The purpose of the governing council is to act as representatives of the DAO and to act in the token holders best interests at all times. There should be no daylight between the desires of token holders and the governing council, and where differences exists, token holders can vote to remove councillors. The purpose is to push the DAO towards a more decentralised model and to focus on innovation and capturing market attention and value.

The 7 person Sushi governing council, will be made up of individuals who have volunteered to serve in their roles and have been duly elected by xSUSHI holders. Anyone can apply to become a council member before the initial vote by applying before 30 November on the Sushi forum. There are no exclusions and core team members are also eligible to apply. Notably, the purpose of the Governing council is to represent the entire DAO as manifested in the token holders and every other aspect of Sushi operations and governance must be subordinate to this group.


Before posting this to snapshot I am aware that in the current governing model, any proposal must be reviewed by core before being taken to vote. I think this is counter productive to achieving a decentralized model and so humbly request that core enable this vote on snapshot if it receives sufficient community interest and once any amendments have been made. I will seek to incorporate feedback to this proposal for a final version in 7 days time.


For: Kampai 2.0 ceases Immediately, new interim governance procedures enacted, elections for governing council to occur no later than 30 November.

Against: Do nothing/ no change.


There is no doubt that market participants value a decentralized model for DEX governance. The current “Core team” model of Sushi is a far cry from what defi participants value. Let’s look at the facts: Uniswap has calcified a divide between Uniswap Labs and Uniswap Governance token holders, resulting in market backlash and worse performance on the UNI token. For years the premise of holding UNI was to gain a share of revenue gained by the fee toggle; only to have this fee go to the Uniswap Labs. Trantor’s points about Sushi losing market share, TVL, and dropping to 17th DEX worldwide in trading volume are well made.

Sushiswap has a unique opportunity to strengthen its market position vs. Uniswap by following this proposal. By returning fees to xSUSHI holders and quickly iterating towards a governance model hybridizing a Council x DAO, Sushiswap will be more transparent and able to serve the token holder’s interests. I think the interim governing council is a needed solution for a temporary centralized governance solution, but expect to see this type of representative democracy dissolved in the long-run.

I agree with Trantor’s proposal and would be very excited to see Sushiswap embody the model of trustless, transparent decentralization that we came here to build in the first place. Beyond the heart of our industry’s ethos, it appears to me that this model would instill greater market confidence in SUSHI as a value-accruing token, which benefits everyone involved in the Sushiswap ecosystem.

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The state of sushi and its current market share are indeed fading compared to peers. It’s challenging to keep up with Uniswap, but losing relative positions to other exchanges is synonymous with weakness in general.

I read the proposal, and I initially agreed with the overall idea, but I thought the approach might have been a bit aggressive. Going from 0 to hero with decentralization in this way is something that can get lost in translation. So, initially, I was only in favor of creating a general council to foster decentralization. Then, I realized that having this election without specifying the vision for this council would be just a way to add further friction in any governance process. So, to summarize:

I think the governance council should be the first thing, with the mandate to express a new framework and view for Sushi as a protocol, to which the general community can discuss and brainstorm on. To me, points A and B are the starting points.
I am personally in favor of returning fees to stakers, but this could be more complex and should probably come after the council is elected. There might be liability issues in going back to this, so a more in-depth discussion with key stakeholders and experts might be needed. So, point C should come later.
Point D is tricky because it is the key to the mandate. I think the initial council, envisioned as experts in governance and the sushi ecosystem, can have a first mandate to assess the state of the DAO, handle key critical votes, and then it can further expand its mandates through a subsequent vote that can help empower it further if needed. So, in the first iteration, the council can be the “voice of the community” through experts and key stakeholders, starting a discussion that is currently absent and should be integrated into the entire sushi ecosystem as a whole.


I am certainly not a tokenomics or defi protocols expert, but what I am sure about is that Sushi is no longer the reference dex it used to be. A change is needed, and this is an exciting proposal to start the fire.


I have updated this proposal to account for the community feedback I have received across a variety of means. Please see the Sengoku-Jidai proposal.

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