1.5 The collapse of infrastructure and trust systems

1# The stability risks of the underlying network

In order to reduce costs, some OlympusDAO imitations choose to be deployed on frequently upgraded public chains (such as Polygon). Due to the immature technology of these public chains, there are often problems such as "hard fork leading to transaction rollback" and "node synchronization delay", which directly lead to the suspension of exchange recharge and withdrawal, and the interruption of user asset circulation. For example, in a Polygon upgrade in 2022, more than 100,000 transactions failed, and users of a project lost 20 million US dollars due to their inability to redeem assets in time, which seriously hit market confidence.

2# The complete breakdown of the cornerstone of trust

When "code is law" was manipulated by capital, and "decentralization" was reduced to harvesting words, DeFi's trust system was riddled with holes. Users scoffed at the project's "commitment not to run away", were wary of the promotion of "algorithm stability", and were completely indifferent to the participation of "community governance". The consequence of this collapse of trust was that a large amount of money flowed out of the DeFi ecosystem, and the industry was reduced from an "innovation hotspot" to a "speculative casino", departing from the original intention of "inclusive finance".

Infrastructure trust crisis: on-chain and off-chain double kill

risk dimension	case	fundamental contradiction
Chain instability	Polygon hard fork caused 100,000 transactions to fail	Expansion chain security does not match DeFi requirements
oracle attack	2022 Curve oracle manipulation event loss 57 million dollars	Data source centralization and weak protocol defenses
Trust collapses	The average lifespan of algorithmic stablecoin projects is only 11.2 months	Technological idealism vs the essence of human profit-seeking

The above pain points are essentially paradigm-level flaws in DeFi 2.0, stemming from three underlying logical fallacies:

①　Capitalism: "holdings = governance rights" as a standard, ignoring time contribution weight and community value creation

②　Technical fundamentals: excessive superstition of "fully automatic algorithm omnipotence", rejection of DAO manual intervention flexible risk control

③　Pseudo-decentralization: Retain centralized backdoors at key points (LP control, upgrade permissions), resulting in the normalization of single points of failure

The essence of these pain points and challenges is the inevitable result of the old DeFi model of "capital first over community, efficiency over fairness, and technology disguise decentralization". The birth of LynkCoDAO is precisely to face these dilemmas and open up a new path of "community-led, fair, transparent, safe and sustainable" for the DeFi industry through mechanism reconstruction and technological innovation.