SIP - 00XY: Vote of No Confidence and Leadership Transition

[SetSovFree]

SIP - 00XY: Vote of No Confidence and Leadership Transition

Sovryn is asking stakers and users to accept major changes while withholding the level of transparency required for informed consent. This SIP restores accountability by rotating leadership and enforcing a structured handover.

Summary

This SIP proposes a formal vote of no confidence in the current operational leadership of Sovryn and mandates their removal from their current leadership roles:

• Yago (de facto executive leadership and strategic direction)

• Armando (treasury and financial operations)

• FrenchVictory (marketing)

If passed, this SIP triggers a time-boxed transition process to an Interim Stewardship Council (ISC) drawn from the community, with clear obligations for transparency, access handover, and continuity of protocol safety.

This SIP does not nominate replacement leaders. A separate follow-up SIP (or set of SIPs) will define permanent leadership selection and long-term governance structure.

Motivation

A functional DAO requires three basics:

1. Predictable governance process for material decisions

2. Transparent financial reporting and treasury accountability

3. Credible communications, including direct answers to material questions

Over the past period, a critical mass of stakeholders has lost confidence that these basics are being met. The current leadership has repeatedly failed to maintain the minimum standard of operational accountability expected for a protocol that custody-risks user funds and coordinates treasury policy.

Concerns raised by the community include, but are not limited to:

• Material decisions taken without prior community mandate or clear governance process, including changes that directly impact staker economics.

• Insufficient and delayed financial transparency, including the absence of timely financial reports and clear treasury runway reporting.

• Unclear treasury actions and rationale, including conversions and movements that were not communicated with adequate detail at the time they occurred, and then later discussed ambiguously.

• Communications failure under pressure, including unanswered questions, partial answers, and inconsistent explanations that amplify distrust rather than resolve it.

• Repeated “trust me” posture, where the community is asked to accept reduced benefits and increased uncertainty without receiving verifiable, complete information.

This SIP is the clean, least-damaging way to resolve a legitimacy crisis: formalize the loss of confidence, rotate leadership, and force a structured handover.

Goals

If this SIP passes, the transition must achieve:

• Continuity of protocol security and critical operations.

• Immediate improvement in transparency and reporting cadence.

• Clear separation between “interim caretaking” and “future leadership design.”

• A credible, community-led mechanism to regain trust.

Non-Goals

This SIP does not:

• Change protocol economics directly (fees, staking parameters, rewards distribution mechanics).

• Modify smart contracts.

• Define the permanent leadership model or long-term treasury policy.
  Those will be handled in subsequent SIPs after stabilization.

Definitions

• Leadership (for this SIP): individuals acting as primary decision-makers for treasury policy, operational execution, and external communications on behalf of Sovryn.

• ISC (Interim Stewardship Council): a temporary, community-selected body responsible for operational oversight and transparency during the transition period.

Specification

A. Removal

Upon successful vote, the following actions are mandated:

1. Immediate removal of Yago, Armando, and FrenchVictory from leadership functions and decision authority over:

   • Treasury operations direction

   • Budgeting and expenditure authorization

   • Official communications and community call moderation as “the voice of leadership.”

   • Any admin or privileged access that is not strictly required for technical continuity

2. Role changes (within 48 hours of SIP passing), to the maximum extent possible:

   • Remove Discord roles and permissions that grant admin or moderation authority (except where required for continuity while access is rotated).

   • Remove access to official channels used for “final say” press releases.

   • Remove access to any “single person” admin points wherever feasible (domains, social accounts, email, shared drives, analytics, etc.), transferring to ISC custodians.

B. Interim Stewardship Council (ISC)

1. ISC size: 5 members.

2. Eligibility:

   • Must be a known community member with a public forum/Discord history.

   • Must disclose conflicts of interest (employment, grants, market-making, paid advisory relationships).

   • Must agree to basic operational discipline: weekly reporting, documented decisions, and public rationale for treasury actions.

3. Selection process (fast and simple):

   • Nominations open immediately after this SIP passes.

   • Nomination window: 7 days.

   • Vote: 7 days.

   • Top 5 by vote become ISC.

If the existing governance tooling requires a different vote mechanic, the intent remains: the community chooses 5 interim stewards using the most legitimate available process within 14 days.

C. Transition and Handover Requirements

Within 72 hours after this SIP passes, outgoing leadership must produce a “Handover Pack” containing:

1. Access and accounts inventory

   • List of all critical systems and accounts (Discord admin, forum admin, multisig operations, domains, web hosting, analytics, social accounts, GitHub org access, CI/CD, server providers, key vendor accounts).

   • For each: who controls it today, what permissions exist, and what the handover plan is.

2. Treasury and runway snapshot

   • Current treasury balances by asset and custody location.

   • Current monthly burn and commitments.

   • The next 90 days of expected expenses.

   • Any liabilities or obligations not publicly disclosed.

3. Operational state

   • Current team roster (roles, grant amounts, contract terms, payment schedule).

   • Critical security procedures and incident response contacts.

   • Pending high-risk items (anything that could impact user funds).

4. Decision log

   • A written summary of the last 6 months of major decisions that materially impacted:

     • Treasury composition

     • Reward distribution policy

     • Team size and budget

     • Any vendor or contractor changes

Failure to deliver the Handover Pack within the deadline should be treated as a breach of the DAO mandate and publicly documented.

D. Control Rotation (Keys and Privileges)

Within 14 days after the SIP passes:

• All critical admin privileges must be moved to ISC-appointed custodians.

• Any multisig signer set changes or operational key rotations that require formal procedures must be initiated immediately and completed as soon as technically possible.

The priority order:

1. Systems that can move funds or change custody.

2. Systems that can change code or deployment.

3. Systems that control communications and narrative (official announcements).

E. Interim Operating Rules (30–60 days)

The ISC must operate under tight constraints to avoid creating “new leadership without legitimacy”:

1. Spending guardrails

   • No new long-term commitments without a separate community approval process.

   • All expenses are published weekly (aggregated is acceptable initially, but must become itemized as quickly as practical).

2. Transparency cadence

   • Weekly written update.

   • Monthly treasury report with balances and material changes.

   • Any decision affecting staker economics must be pre-announced with rationale and a clear path to governance.

3. Security-first

   • Any change that could impact user funds requires documented review and, where applicable, independent auditing or peer review.

F. Follow-up SIPs (required)

This SIP explicitly commits the community to two follow-up governance actions:

1. SIP: Permanent Leadership Model

   • Defines roles, accountability, compensation policy, reporting standards, and recall process.

2. SIP: Treasury Policy and Reporting Standard

   • Defines allowable treasury allocations, risk limits, stablecoin exposure policy, and mandatory reporting format.

Rationale

A no-confidence vote is not “drama.” It is a standard governance tool when:

• There is a legitimacy gap between leadership actions and stakeholder mandate.

• Transparency failures block informed consent.

• Communication failures degrade trust and participation.

This SIP isolates the minimal necessary action: remove decision-makers who no longer have community confidence, install a time-boxed interim group, and force an orderly handover.

Risks and Mitigations

1. Risk: operational disruption

   • Mitigation: ISC is temporary and constrained. Security and continuity are explicit priorities.

2. Risk: hostile takeover narrative

   • Mitigation: transparent process, public handover requirements, and clear guardrails on spending and decision scope.

3. Risk: key/permission bottlenecks

   • Mitigation: deadlines, public inventory of access points, and a priority-based rotation plan.

4. Risk: The interim council underperforms

   • Mitigation: short mandate, weekly accountability, and the option to replace ISC members via a quick recall vote if needed.

Timeline

• Day 0: SIP posted.

• Day 0–14: Public discussion period (amendments, final wording).

• Day 14: Vote begins (or at the earliest eligible time per the governance process).

• If passed:

  • Within 72 hours: Handover Pack delivered.

  • Within 14 days: ISC elected and control rotation initiated.

  • Within 30 days: First full monthly treasury report under ISC.

  • Within 45–60 days: Follow-up SIPs submitted (permanent leadership model, treasury policy).

Proof

Even if this SIP never reaches a vote because of a veto or because a few big wallets can block it, that result still tells us something important: it shows who really controls the process, and whether the community can hold leaders accountable. Even if they deny any concentrated control and say it is “for project protection,” stopping an open vote would effectively prove the point and be written on the record.

Vote

For: Remove Yago, Armando, and FrenchVictory from leadership roles and initiate interim community stewardship as specified.

Against: Maintain current leadership.

[frenchvictory]

A message like this should definitely be allowed to air on the forum, though I find it emotionally driven rather than a practical plan of replacing leadership. If a vote passes that asks me to step down i will, and will hand-off to the best of my abilities. However, this SIP as written puts user funds at risk for these reasons below, and it is definitely not mature enough to be considered for an actual vote.

- You explicitly don’t nominate replacements, yet mandate immediate removals / permission stripping on a 48h clock. Meanwhile the “ISC” election can take up to ~14 days. That creates a leadership + accountability vacuum during the highest‑risk window for a protocol coordinating security + treasury.

- The handover/key-rotation plan assumes full cooperation from the same people you’re stripping of authority. Deadlines aren’t an enforcement mechanism, and “transfer to ISC custodians” is undefined until the ISC even exists.

- The “if it never reaches a vote, it proves the point” framing is unfalsifiable (heads‑I‑win / tails‑you-lose) and reads like rhetoric, not evidence.

- ISC selection is popularity-based (top 5 by votes) with no minimum ops/security/treasury competence requirement, which increases capture and execution risk.

Also, please bear in mind that the entire idea of rediverting protocol revenues from stakers to the exchequer is because Sovryn is not cash flow positive, and we’re trying to make sure it stays up for as long as it can without burning through treasury funds. The economic reality of companies that can’t sustain themselves is normally to close down. This is a last resort option that I wouldn’t like to execute, but if the alternative is risking the deposits of user funds, then this would be the way to go.

This is my own personal view on this matter.

[Hyde]

I must say that this is a bold proposal. It is well written and structured, but introduces some logical gaps.

Let me start with a red flag that struck me while reading this.
You specify that ISC members:

@SetSovFree

Must be a known community member with a public forum/Discord history.

Yet You Yourself joined the Sovryn forum just 18 hours ago. This appears to be Your very first posts here under this username. I haven’t seen this handle in any other Sovryn channels - Discord, Telegram, X, or elsewhere in the ecosystem.

For basic transparency could You please share:

• Any previous nicknames/handles You’ve used in Sovryn spaces?
• Your actual involvement/contributions to the project prior to creating this account?

Without that context, it’s hard to take seriously a call for leadership accountability from someone with zero visible track record in the community.

On the content: while the listed frustrations (transparency issues, delayed reporting, unclear treasury moves, etc.) resonate with ongoing community sentiment, the mechanics proposed create more problems than they solve.

If the goal is to replace leadership, the SIP really should name temporary / interim candidates to avoid creating a dangerous operational gap. Running something the size of Sovryn involves significant ongoing efforts and expenses.

In my view, any responsible transition should actually start with an audit of current state. That way, incoming stewards could assess the real situation - balances, runway, commitments, liabilities - before making decisions. Jumping straight to key rotations and control changes without that baseline feels backwards and increases rather than reduces risk.

From my experience (in crypto and beyond), there’s often strong appetite for “change the leadership,” but far fewer people who are both willing and capable of handling the day-to-day reality and keeping everything running smoothly. Without demonstrated capacity or named alternatives, this risks turning into disruption rather than meaningful improvement.

[Timechianman]

This feels like a heavy reaction.

Aren’t SIPs primarily intended for smart contract–related matters? Was the rationale behind this executive decision not clearly communicated by Yago?

Rather than framing this as a leadership issue, it may be more constructive to focus on the broader context: if Sovryn fails, we all lose our investments. If Sovryn successfully navigates this bear market, launches Sov Layer, and gains traction on a stronger chain, we all stand to benefit.

Just my perspective.

[SetSovFree]

Funny how this is the fastest you’ve replied to something in months. Improving under pressure.

Also, thanks for saying it “deserves to be here.” Even funnier part: it only shows up here because someone in the same leadership circle has to approve it first. “Bitocracy,” but with a bouncer at the door. Great system.

On your points:

• No nominees yet. Correct. That’s why this is v0 and why I’m collecting names and criteria now.

• “Vacuum risk.” Agreed. The next revision will sequence the handover so there’s no gap.

• “Assumes cooperation.” Exactly why the handover needs enforceable steps, not goodwill.

• “Heads I win.” Fair. I’ll rewrite it to be falsifiable, not rhetorical.

• Competence requirements. Agreed. Popularity is not a security model.

This is draft v0, posted to collect objections and tighten the transition mechanics. If you want it vote-ready, drop concrete requirements instead of vibes. Otherwise it just reads like “trust us, and please stop asking.”

And genuinely, thanks for the help. Every reply like this makes the case cleaner, and you’re doing a great job helping me build the record for replacing you.

[SetSovFree]

Appreciate the critique. You’re right, the mechanics need to be tighter and the operational risk needs to be spelled out, not hand-waved.

This is step one: get the objections on record, then iterate. If you can list the top 3 transition risks you’d want solved before you’d consider this voteable (key rotation, custody continuity, audit baseline, etc.), I’ll bake them into the next revision as concrete requirements, dates, and acceptance criteria.

Also, I’m intentionally not sharing who I am right now. I want the proposal to do the talking. If this moves toward a vote, I’ll host a live Q&A under my real name, answer questions directly, and only then push it to an onchain vote once the community has had a fair chance to review and challenge it.

[frenchvictory]

Your posts are being auto-flagged as spam, for “new user is typing too fast.”

And i’m not here to do your work for you, It’s your SIP.

[SetSovFree]

I respect the optimism. It’s rare, and the project genuinely doesn’t deserve community members like you.

But “be patient, the layer is coming” only works when the same people in charge consistently deliver, report, and ask for consent before moving goalposts.

Remember when the narrative was basically “BitcoinOS is being built by Sovryn”? That’s exactly why “just wait a bit longer” doesn’t land anymore.

If they ship Sovryn Layer with transparent finances and rule-based governance, I’ll happily eat my words. Until then, the responsible move is to stop gambling on hope and start enforcing accountability.

[Hyde]

I am glad that You acknowledge some of the flaws of this proposal - that’s a step in the right direction.

That said, I don’t buy the “proposal should do the talking first, identity reveal only if it moves to a vote” approach.

You’re literally proposing a vote of no confidence in named individuals, removal from roles, key rotations, treasury handover, and a new leadership body - all while insisting on “known community members with public history” for the ISC. Yet You’re withholding Your own identity, contributions, history, etc. until some undefined future point “if this moves toward a vote.”

That’s textbook hypocrisy. The proposal demands high standards of transparency, accountability, and track record from everyone else (current leadership, future stewards), but exempts the proposer from those same standards until the community has already invested serious time debating and potentially voting on it.

In a trust-minimized environment like a DAO - especially one custodying user funds - anonymous high-impact proposals are risky by default. People can (and do) use throwaway accounts for influence ops, griefing, or personal agendas. Demanding the community treat this as legitimate while staying hidden until “later” isn’t reasonable. It shifts all the trust burden onto everyone else.

If the goal is genuinely to rebuild trust and accountability, and not just stir drama, then basic reciprocity applies: share at minimum Your prior Sovryn involvement now, so people can evaluate whether this comes from a good-faith community member or not. A live Q&A “if it moves forward” is too late - the discussion and iteration happen before any vote.

I do value anonymity myself and can understand why someone might prefer to stay pseudonymous at first - crypto is built on privacy for good reason. But when You’re proposing something like this, presence and a verifiable track record are what prove accountability and good faith. You can’t reasonably demand high standards of transparency while exempting Yourself from any visible history

Until that transparency is provided, it’s hard to take this beyond a thought experiment. The operational risks remain unaddressed properly, and the lack of accountability undercuts the entire “restore trust” framing.

Happy to engage seriously once we know who’s actually behind this.

[TM1]

Leadership will operate and drain (eventually even gamble) protocol funds in total shades of darkness for years.

While community not even deserves to know ‘how many people are working on things’ or get some unverifiable numbers on a PowerPoint as financial report..

Yago going crazy and almost calling names (borderline, conspiracy, etc..) when getting asked which person was behind Mynt ..

Yet the SIP creator somehow has to prove or show eventual other names, contributions etc? Yeah sure. Team’s gaslighter is charged i guess.

[Hyde]

I agree - the community deserves real, timely financial reports. I’ve been asking for better transparency on that front myself for a long time.

On the SIP creator though: proposing concrete, high-stakes actions carries real risks that need to be called out. That’s why I see a need for basic accountability from whoever is putting it forward - separate from the Sovryn’s Leadership own transparency failures.

Both issues can be true at once.

[TM1]

@Hyde

Both issues can be true at once

Well said. I agree to this.

Still, I think this mostly anonymous and partly pseudonymus team has brought up (even recently) radical SIPs as well .. can only suspect that this SIP is kind of an ‘it is really enough now’ answer to things that are cooking for years already.

[666SOV]

can we have the full list of who is in exchequer?

we do need accountability 100%

[sovrynday1]

so even inside Sovryns core team structure, people such as yourself that are in direct contact with these people can not get through?

this is even harder if not impossible for us community members, but over the years i have seen community members constantly bring this up only to be ignored or derailed, and we should ask ourselves why is that?

in my experience of life and buisness, it is almost guaranteed Exchequer & Armando specifically is mishandling/stealing/using treasury funds as his own basket of liquidity for personal gain. Similar to recent allegations of Jane Street using their blackrock-BTC position to manipulate BTC market, i can not do anything else than assume Armando/ Exchequer has used their position to manipulate SOV market

why is this not being taken more seriously, this is not something small you delay or sweep under the rug, he should be under absolute scrutiny and have to prove his innocence, not the other way around when theres been ~2 years absence & now proof of selling DLLR to BTC in January without any voting or discussion

at this point power needs to be stripped away and moved to bitocracy or other, @Brianna has had good suggestions regarding this matter & also a community favorite to step up and get insight into the books

[Brianna]

I agree this SIP is very reactionary and emotional, but so was the announcement to divert 100% of staker BTC & DLLR revenue to exchequer (announced right after Bitcoin fell to $60k).

@frenchvictory

The economic reality of companies that can’t sustain themselves is normally to close down. This is a last resort option that I wouldn’t like to execute, but if the alternative is risking the deposits of user funds, then this would be the way to go.

That’s what I find amazing. Yago on the call explicitly rejected the idea of cutting overhead or reducing salaries. That is the first step of companies - not shutting down completely.

Please come up with a reasonable, well thought out plan to introduce control of a real treasury contract owned by bitocracy and funded by a fair percent of protocol revenue. Bitocracy will vote annually or biannually to release budgeted funds to exchequer for cover overhead.

No one’s asking for fancy slides or pdfs. We just want a simple spread sheet that shows expense categories like any company would have.

[Brianna]

Zero Contracts and most of the protocol contracts seem to be owned by Bitocracy governance address (0x967c84b731679E36A344002b8E3CE50620A7F69f). Somehow exchequer was set to owner and proxy owner on the fee sharing contract and they just updated the implementation address with the new contract code to divert all protocol fees to exchquer. Fortunately we can overwrite the protocol and zero feesharing contract address with a previous version and set the owner to Bitocracy governance as well. I’ll be releasing an emergency sip to do this shortly.

We should look to update this contract with a treasury fee that gets diverted to the Governance Vault controlled by bitocracy to fund exchequer. This will allow for continued operations while providing oversight via bitocracy with finally a transparent budget request.

[Hyde]

@sovrynday1

i can not do anything else than assume Armando/ Exchequer has used their position to manipulate SOV market

You know - if so, it’s all on blockchain - You can always try to look for proofs instead of assuming. To my knowledge amount of SOV in control of the Exchequer never was significant.

[sovrynday1]

it was verified by Brianna he is moving funds without any permission, so what else is there to prove?

if it has been already proven once, im not assuming this is the first time, as we have not had any financial updates in almost 2 years now & Armando himself is absent from pretty much every discussion around finances tht i have taken note of these past years

welcome you to go ahead and prove the opposite instead

[Hyde]

You made a very specific accusation:

@sovrynday1

i can not do anything else than assume Armando/ Exchequer has used their position to manipulate SOV market

@Brianna only verified that funds were moved. To my knowledge, that had nothing to do with the SOV token itself.

So please - support Your claim of SOV market manipulation with actual proof, not speculation.

We can agree on the lack of proper financial reports. But I won’t agree with serious accusations that have no evidence. You made the claim - the burden of proof is on You, not on me to “prove the opposite.”

As a separate point: earlier SIPs explicitly granted the Exchequer authority to move funds as needed. No additional Bitocracy permissions are/were formally required. But that’s a different discussion.

[Brianna]

This is true. I haven’t looked into any potential manipulation of SOV, nor do I expect that to be the case. I think sovrynday1 is probably speculating that since exchequer had free rain of the treasury with no oversight and that the adoption and development funds of SOV were all transferred to exchequer that likely they sold most of that SOV depressing the prices. Was that intentional to “manipulate” the price of SOV? I don’t personally believe that.