Scroll DAO has officially suspended its governance mechanism and announced the resignation of its DAO leader, Eugene, leading to market uncertainty.

Executive Summary

Scroll DAO, a prominent decentralized autonomous organization, has announced the temporary suspension of its governance mechanism, coinciding with the formal resignation of its DAO leader, Eugene. This development has introduced uncertainty regarding the execution of ongoing governance proposals, including critical treasury management initiatives. The decision reflects broader challenges within the decentralized finance sector concerning governance models and community trust.

The Event in Detail

The suspension of Scroll DAO's governance activities became official this week, marked by the departure of its leader, Eugene. While Scroll co-founder Haichen has indicated the team is "redesigning governance," a definitive timeline or clear subsequent plans have not been provided. Team members have publicly emphasized that the governance change is a "pause" rather than a "stop" or "dismantle."

Several ongoing governance proposals, including those pertaining to treasury management, now face an uncertain execution status. Further transparency concerns arose when olimpio, a community representative with substantial governance power, reported being banned from the Scroll Discord server.

Market Implications

The halting of Scroll DAO's governance and the leadership transition are likely to foster increased uncertainty within the Scroll ecosystem and potentially impact the associated SCR token. Such events typically lead to a decline in community trust, especially when coupled with transparency issues. This situation underscores the inherent complexities and evolving nature of decentralized autonomous organization (DAO) governance.

The Scroll DAO event parallels recent developments in other prominent DAO ecosystems. For instance, Solana-based decentralized exchange Jupiter decided to temporarily suspend all DAO voting activities through the end of 2025, citing internal tensions and aiming for a "fresh approach" to governance in 2026. Similarly, Arbitrum DAO has faced criticism regarding proposals for reinvesting treasury assets, highlighting ongoing challenges in managing community expectations and financial decisions within decentralized structures.

Expert Commentary

While the Scroll team characterizes the governance change as a temporary "pause" aimed at redesigning the system, the lack of immediate clear plans or a timeline contributes to market speculation regarding the future operational model of Scroll DAO. The move to redesign governance, as stated by Scroll co-founder Haichen, suggests an acknowledgment of the need for a more robust or redefined governance framework, even as the immediate impact is a centralization of decision-making.

Broader Context

The suspension of Scroll DAO's governance mechanism occurs within a broader industry trend of DAOs grappling with the practicalities of decentralized decision-making. While Scroll itself recently announced achieving Stage 1 decentralization for its Layer 2 scaling solution, aimed at enhancing security and user empowerment by moving from a centralized to a distributed governance model, the current DAO governance suspension presents a contrasting situation. This highlights the ongoing tension between the ideals of decentralization and the practical demands of efficient, responsive project management and financial stewardship within the Web3 ecosystem.