Compound DAO passes $24 million proposal in alleged governance attack

A controversial proposal in front of the Compound Finance DAO has narrowly passed, granting 499,000 COMP (~$24 million, and amounting to 5% of the project's treasury) to an outside group. A Compound Finance whale, "Humpy", proposed the vote to allocate the tokens to a protocol created by a group called the "Golden Boys", which Humpy also leads. The vote was the third attempt to allocate tokens to the Golden Boys' group, after two unsuccessful votes in May and earlier in July.

Humpy has previously been accused of governance attacks on other protocols, including Balancer and SushiSwap.

Prior to the proposal's passage, some Compound Finance DAO members raised objections. "In my personal opinion, the actions of Humpy and the Golden Boys can be considered a governance attack if they persist in their attempts to take funds from the protocol in clear opposition to the will of all other Compound DAO delegates," stated Compound Finance security adviser Michael Lewellen, who also described the proposal as "a malicious attempt to steal funds from the protocol".

Afterwards, Lewellen wrote that "OpenZeppelin is working with all active delegates and Compound contributors to assess our options for protecting the protocol. We see serious risks to the future decentralization of the DAO as a result of Proposal 289 passing and so we are exploring options to mitigate or reverse this outcome."