SUN.io: Governance Innovation and Ecosystem Prosperity in Tron DeFi

Pump.fun is an undisputed decentralized platform as a Meme Launchpool, achieving high returns but still retaining a centralized distribution model. Uniswap, the most respected DEX in blockchain, remains at the top of trading volumes but faces controversy over its token model.

What kind of model does Web3 decentralization need to avoid becoming a tool for capital exploitation? Does a free market require corporate presence, and how can the decentralized financial market explore DAO governance models more deeply?

SUN.io, a leader in Tron DeFi, has been committed to exploring and pursuing decentralization. On July 31, SUN.io announced the official establishment of SUN DAO, marking a new chapter in DAO governance.

With the introduction of SUN DAO, SUN.io’s governance mechanism and economic model are continuously optimized, the decentralized community governance is evolving, and the application scenarios of the SUN token are expanding.

As a pioneer in exploring DAO governance models, what exactly is SUN.io, and how does it create its decentralized financial and governance formula? This article will delve into SUN.io’s journey of decentralization.

What is SUN.io?

Before understanding SUN.io’s exploration of decentralized governance, it’s essential to have a basic understanding of SUN.io.

SUN.io is a decentralized financial ecosystem built on the Tron blockchain, offering a variety of financial services and products. It supports the exchange, liquidity mining, and decentralized governance of various tokens and stablecoins within the Tron ecosystem.

It is a one-stop platform designed for Tron DeFi enthusiasts, particularly liquidity mining users, stakers, and those interested in participating in decentralized governance. It caters not only to the general public but also provides developers with more convenient channels.

When discussing Web3, the pursuit of decentralization is always a central theme. Since adding SUN.io to the project watchlist, it’s evident that they have consistently adhered to this principle. Their core philosophy is pure — to build a fully decentralized exchange (DEX) within the Tron ecosystem, owned by the community.

With further exploration into decentralization, SUN.io aims to transfer platform control to token holders, achieving true community autonomy and maximizing benefits for every community member.

Exploring SUN.io’s Governance Model

Productivity determines production relations, evolving from family businesses to joint-stock companies, from unions to platform enterprises. The exploration of production relations to meet new era development demands has never ceased.

Rapidly advancing productivity presents new challenges for production relation reforms. In the decentralized Web3 domain, the DeFi market resembles a free market model, unsuited to corporate management governance models.

As the SUN.io protocol expands and its market ecosystem develops, traditional human-centric governance models no longer suffice. SUN.io began transforming its governance model, extending organizational boundaries through SUN DAO. This move aims to better support community development and construction, achieving reverse reforms from production relations to productivity.

Exploring Starfish Organizations: Why Introduce SUN DAO?

In terms of organizational form, humans are not short of DAO as a decentralized organization in reality. Early forms of self-organizing phenomena in natural ecosystems, such as CMO (Dynamic Netizen Organization) and DAI (Distributed Artificial Intelligence), can be seen.

Ori Brafman and Rod Beckstrom’s 2007 book “The Starfish and the Spider” vividly describes this decentralized organizational form.

Although spiders and starfish look similar, their cores are entirely different. When cut in half, the spider dies, but the starfish can split into two.

This illustrates that decentralized organizations are actually more resilient than centralized ones. They feature high decentralization, transparency, and autonomy, with no hierarchical authority and top-down management, aligning well with blockchain technology. By introducing SUN DAO, SUN.io can fully leverage the advantages of decentralized governance:

• Achieving ecosystem co-construction through community governance.
• Realizing shared benefits through token design.
• Aligning with consensus ideals for sustainable project development.

Vitalik Buterin mentioned two major features of DAO in the Ethereum whitepaper: decentralization and autonomy. SUN.io’s updated governance model aligns well with this philosophy, embodying an exploration and practice of Buterin’s ideas. The combination of DeFi and DAO could bring SUN.io tremendous growth potential.

SUN DAO for Governance

Decentralized finance requires decentralized governance. As a governance tool, SUN DAO delegates power to token holders through smart contracts. Based on users’ contributions, SUN.io grants corresponding proposal and voting rights. This model is a good practice of decentralization.

However, several issues arise:

• The relationship between voting rights and token holdings — When DAO governance is determined by token weight, wealth disparity may allow the rich to control voting outcomes, deviating from the initial decentralization intent.
• Short-term incentives vs. long-term ecosystem building — Short-term incentives to attract users can lead to liquidity depletion by whales, damaging ecosystem construction.

This indicates that governance tokens offering nothing beyond voting rights have many problems, requiring more sophisticated model designs to achieve decentralized governance. How does SUN DAO address these issues?

VE Token Model: Optimizing SUN DAO

Although the Matthew effect and voting paradox prevent a perfect decentralized governance system, exploration can infinitely approach fairness and transparency. The VE (vote escrow) model is a good solution, similar to the governance model adopted by SUN DAO.

The core mechanism of VE involves users locking tokens to obtain veTokens. VeTokens, as non-transferable and non-circulating governance tokens, grant more veTokens the longer they are locked. Based on their veToken weight, users gain proportional voting rights.

Voting rights determine decisions that materially impact user benefits, like the allocation of reward pools. This enhances users’ holding incentives, reduces selling pressure, and retains true ecosystem co-builders, making it a solid DeFi + DAO exploration.

SUN DAO Governance Model

SUN DAO’s overall governance logic is similar to the above, primarily governed through proposals. SUN tokens enable holders to collectively act as protocol stewards, allowing them to vote and propose. Through governance mechanisms, all participants within the SUN.io ecosystem can reach a consensus. The governance method is relatively simple but still in the early construction stage.

Its core security elements include protocol functions and SUN tokens:

• Protocol functions: The governance mechanisms in decentralized protocols cover community participation, incentives, self-regulation, and policy management. SUN DAO primarily governs through on-chain proposals, achieving self-operation, self-management, and self-development according to preset rules without third-party intervention, maximizing efficiency.
• SUN tokens: In SUN DAO’s governance process, SUN tokens, as a key component, digitize and tokenize organizational elements, effectively merging monetary, human, and other capital to enhance organizational efficiency. The goal of SUN token economics is to ensure the positive and long-term development of the SUN.io ecosystem, allowing stakeholders and investors to benefit under a more secure protocol. SUN token holders bear responsibility for the protocol and ecosystem, contributing through actions, typically in the form of technical integration or financial investment, significantly impacting protocol execution, security, and functionality.

Based on the trust relationship stipulated by SUN DAO, including mutual trust among SUN token holders, market participants, liquidity providers, and integrators, economic incentives are implemented. These measures, based on liquidity governance, aim to keep voting pools active and expand with new SUN.io ecosystem participants.

SUN DAO Governance Process

1. Proposal Stage: Any governance idea can be proposed and discussed in the SUN DAO forum. If the discussion is without controversy, any user holding more than 30 million veSUN can initiate a proposal on the platform, and other users can participate in the voting. “The value of 30 million is reasonable at this stage, but as the number of circulating tokens changes and the average holdings of token users fluctuate, different values need to be provided.”
2. Review Stage: Once the proposal is successfully created, it enters a 2-day review period.
3. Voting Stage: After the review period ends, veSUN holders can vote. Each veSUN counts as one vote, and users vote for or against the proposal based on its content. Each wallet address can vote only once. The voting period lasts for 3 days. When the proposal receives more than 90 million votes in favor and exceeds the opposing votes, the proposal is approved.
4. Execution Stage: After voting ends, if the proposal is approved, it enters a 48-hour lock period. Once the lock period ends, the proposal takes effect immediately. (Note: Any changes to the protocol require at least 7 days.)

From SUN DAO’s governance process, the design is quite straightforward. This governance framework relies on system incentives and multi-level governance, creating an effective balance that promotes the protocol’s long-term growth and continuous optimization. In this model, SUN token holders can collectively act as protocol managers, enabling community autonomy, voting, and proposing.

However, freedom needs to be checked, and so does the scale of DAO’s power. From MakerDAO’s governance struggles, it’s evident that as the protocol expands and the token vote count increases, reaching consensus and making more professional decisions are areas SUN DAO needs to continuously optimize.

Beyond Governance with veSUN

Although SUN DAO is in its early stages, the ecosystem empowerment and application scenarios for veSUN holders are already quite rich. Holders can participate in voting governance, enjoy community incentives and rewards, and have considerable rights in protocol revenue distribution and asset management.

This not only further motivates SUN token holders to participate in protocol governance but also provides veSUN holders with more benefits, thereby enhancing the overall activity of the SUN.io ecosystem.

Currently, staking SUN can earn corresponding amounts of veSUN. veSUN holders enjoy rights such as:

• Participating in SUN DAO voting
• Accelerated liquidity pool mining up to 2.5 times — calculated using virtual balances, with mining rewards allocated based on virtual balances. Thus, veSUN holders can mine at a rate up to 2.5 times faster than non-veSUN holders.
• Voting on liquidity pool weight — Users can vote on the weight of different liquidity pools using veSUN. Weekly snapshots determine the next week’s pool weights. Users can vote based on their veSUN holdings, and to prevent frequent vote changes, users can only change their votes 10 days after casting them.
• Receiving 50% of stablecoin pool transaction fees as rewards — 50% of the transaction fees from stablecoin pools will be distributed to veSUN holders in TUSD. Currently, multiple snapshots of veSUN holdings are taken during each round (Thursday 00:00 to the following Tuesday 00:00). At the end of each round, weighted TUSD rewards are calculated and distributed to users based on their veSUN holdings via smart contracts.

How to Become an Early Contributor

The introduction of SUN DAO by SUN.io, whether from its governance process or empowerment of rights, is an excellent practice of the DeFi + DAO formula. Instead of relying on complex governance processes that increase user participation barriers, it achieves decentralization and shared building and sharing by insightfully understanding users’ true needs and decentralizing project governance rights.

On this basis, the project team and token holders can form a positive cycle, establishing a virtuous flywheel to jointly uphold the mission and vision of community co-governance and ecosystem prosperity.

Although SUN DAO is still in the early stages of decentralized governance, it already has a good start in practice. Believing in its future potential, how can users participate and grow with the project to achieve common prosperity?

How to Get Votes?

First, to get votes, if you already hold SUN, follow the process below to participate. The method of obtaining votes is quite simple. Users can obtain veSUN by staking and locking SUN tokens, thus participating in community governance. By choosing “SUN Lock,” and confirming the quantity and unlock time, users can obtain corresponding amounts of veSUN.

The overall participation process is as follows:

1. Log in to https://sun.io/, click “Lock to get veSUN” in the “SUN Lock” section, confirm the amount to be locked and the lock period, then click the “Deposit” button. The unlock period ranges from 26 weeks (6 months) to 4 years (365 days * 4). All locked tokens share the same unlock time, with a maximum lock period of 4 years, and all locked SUN will expire at the same time; meanwhile, locked SUN will earn veSUN.
2. After authorization, click “Accept” in the wallet signature pop-up to complete the deposit.

How to Vote?

Once you have obtained the corresponding votes, how do you exercise your voting rights:

1. On the “DAO Governance” homepage, select a proposal labeled “In Progress,” click to view the proposal content and participate in voting.
2. On the voting governance detail page, choose to cast “For” or “Against” votes.
3. After selecting the option, a voting window will appear. Enter the number of votes and click the “Vote” button.
4. After clicking the “Vote” button, click “Sign” in the TronLink signature request pop-up to confirm the voting operation.
5. After confirming the transaction, you will be prompted that the transaction has been sent. You can check your voting status on the page. Note that each wallet address can only vote once.

How to Redeem SUN?

1. After locking SUN, you can view the amount of SUN locked and the voting rights obtained on the page. Clicking “View Details” will also show the lock expiration date.
2. Once your locked SUN expires, you can click “Withdraw” to redeem SUN. Upon redemption, the corresponding voting rights will be reset to zero.

Conclusion

The exploration of decentralization still faces many issues at this stage. Democratic voting may be heavily influenced by the Matthew effect, decentralized governance may lack professional management, and eliminating information asymmetry requires inefficient decision-making and dispersed consensus.

Although Utopia is far-fetched, the idea of decentralization has deeply rooted in people’s minds, necessitating timely reflection on whether current innovations are on the right path. However, facing the future, no one knows which new chapter is the true prologue. How will DeFi + DAO form the perfect formula? How will the path of decentralization be explored? In today’s volatile market, SUN.io, as a true practitioner, remains steadfast in advancing towards deeper decentralization.