Paradigm-backed Across Protocol explores letting ACX holders exchange tokens for equity

Across Protocol, a Paradigm-backed blockchain interoperability protocol, has posted a temperature check proposal exploring a transition from a decentralized autonomous organization and token structure to a U.S. C-corporation and equity structure.

Under the plan, a new entity called AcrossCo would become the operating company behind Across Protocol. ACX tokenholders would then have two options: equity exchange and token buyout. The equity exchange option involves exchanging ACX for equity in AcrossCo. Larger holders would exchange directly, while smaller holders could participate through a no-fee special purpose vehicle structure. The token buyout option would allow holders to redeem ACX for USDC at the one-month average market rate, with a six-month window to decide.

Across said becoming a private company, with tokenholders offered equity or a “fair” exit, would likely better serve the protocol’s long-term growth. The team said the underlying protocol would continue operating without interruption. AcrossCo would hold the intellectual property and manage development, partnerships, and commercialization, while the infrastructure itself would remain open and permissionless.

"I believe this proposal lets us double down on our future while benefiting all existing tokenholders," said Hart Lambur, Co-founder of Across Protocol.

The current DAO structure

Currently, Risk Labs Foundation, the team behind Across Protocol, as well as UMA Protocol, a decentralized oracle, manages the Across protocol. The foundation has been building Across for over four years and says the protocol has processed more than $35 billion in volume and co-created the cross-chain intents standard. Across Protocol is an intents-based interoperability protocol that connects blockchains such as Ethereum and Solana, allowing users to bridge and swap tokens across networks.

Across Protocol has raised a total of $51 million through two token funding rounds. Its most recent round last year was led by Paradigm, with participation from Bain Capital Crypto, Coinbase Ventures, and Multicoin Capital.

The team said the transition to a C-corporation and equity structure is being explored as demand for the protocol’s infrastructure grows, particularly from institutional partners. Across said the current DAO structure can create limitations when working with enterprise partners, which often require enforceable contracts and a clear legal counterparty.

"As institutional demand for Across infrastructure has grown, the current DAO structure has become a bottleneck," the team said. "Enterprise partners need enforceable contracts. Revenue agreements need a legal counterparty. The kinds of deals that would drive the next phase of growth require a structure that a DAO, today, simply can't provide."

If community sentiment is positive, the team will then move to posting a formal governance proposal two weeks after the temperature check, Lambur told The Block.

A majority vote would determine the outcome, Lambur added. For example, if 20% of voters abstained and the result was 41% in favor and 39% against, the proposal would still pass, he said.

"The community decides whether any of it happens," Across said. "Nothing moves forward without community approval."

The ACX token is currently trading at around $0.035, up nearly 4% over the past 24 hours but down about 84% over the past year.