After careful review, I advise against adopting the proposed measures for the following reasons:

1. Misuse of Funds: My investigation reveals that Acala has not utilized the funds raised during its funding round (“Acala: Ready the Treasury”) for the intended purpose, as advertised. Instead of allocating the funds to the Treasury, there is a lack of clarity surrounding the utilization and distribution of the funds. This is a significant breach of trust and may have legal ramifications.
2. Insufficient Transparency: Acala has failed to provide adequate transparency concerning the whereabouts of the funds. As a result, there is growing uncertainty and mistrust within the community. This is unacceptable and necessitates corrective action to restore confidence in the ecosystem.
3. In agreement with Daniel Schoeneberger’s recent assertion, Web3 projects should provide enhanced security, privacy, and transparency, addressing numerous issues engendered during the Web 2.0 era. Consequently, Polkadot, in its capacity as the Relaychain, cannot be entirely exempt from responsibility for the activities transpiring on its Parachains. Acala’s conduct casts a negative light on Polkadot, which, if left unaddressed, may jeopardize the reputation and credibility of the entire ecosystem.

In light of the above concerns, I believe it is crucial to explore alternative measures to mitigate the situation and restrict Acala’s ability to operate without proper oversight. Let’s discuss the following alternative actions:

1. Removal of Council Members: I recommend removing all individuals implicated in this issue from their positions within the Polkadot and Kusama Councils. The individuals in question are Joe Petrowski, Acala Foundation, and Dan Reecer.
2. Restrict Acala’s Access: I suggest revoking Acala’s access to operate as a Parachain and, instead, allow it to function as a permissionless pay-as-you-go Parathread. Its sole responsibility should be to enable a decommissioning process for remaining funds and disburse the lcDOT in October as planned.
3. Confiscation and Burning of DOT Tokens: I propose seizing and burning the DOT tokens allocated for the current successful Parachain Auction 3336. This action will serve as a deterrent against future misconduct and signal Polkadot’s commitment to maintaining a secure and trustworthy ecosystem.

There is some uncertainty as to whether this response to the proposal is the appropriate format or if it would have been more suitable to submit a separate proposal. Nonetheless, the issues raised herein remain of paramount importance and warrant due consideration.

I trust that my response and suggestions will be given due consideration, and remain available for further discussion or clarification on any points raised.

Sources:

1. [Acala Treasury Raises Over $61M from 26k+ Contributors Ahead of Acala’s DeFi Smart Contract Platform Launch on Polkadot, Sep 8, 2021](https://medium.com/acalanetwork/acala-treasury-raises-over-61m-from-26k-contributors-ahead-of-acalas-defi-smart-contract-bfa0fc26db9c)
2. [It’s Time to Build Acala and Ready the Treasury, Aug 14, 2021](https://medium.com/acalanetwork/its-time-to-build-acala-and-ready-the-treasury-e31a42342d11)
3. [Build Acala: Ready the Treasury Kickoff, Aug 12, 2021](https://www.youtube.com/watch?v=NiDgR-4Z-qg)
4. [Acala’s Decentralized Sovereign Wealth Fund — A Next-gen Unforkable DAO, Dec 2, 2020](https://medium.com/acalanetwork/acalas-decentralized-sovereign-wealth-fund-a-next-gen-dao-unforkable-aum-80f8c23d8f27)
5. [Building a Decentralized Sovereign Wealth Fund, Feb 27, 2020](https://medium.com/acalanetwork/building-a-decentralized-sovereign-wealth-fund-6a5a0ae995b1)

Excellent proposal (Although I don't understand " burning of Dot" part instead of sending them to Acala treasury as ptomised). This project ended up with one private company having all the funds (whereas Acala treasury has none) and pursuing its profit with zero transparency. Cefi in disguise.

Dear,

I see some interesting point, but also one important point forget for me.

Acala have the LCDOT with inside 2% of all DOT in circulating.
It's not a detail so.

LCDOT can be redeem to DOT only after the end of the first parachain lease.
So without a second parachain lease, how they can do to redeem it ?

If this point aren't be take in consideration with a clear answer I don't think than you proposal protect the ecosystem as 2% of all DOT are inside LCDOT.

Thank you to analysis this topic, as it's a mandatory point.

Of course we need also to have a clear audit of this redeem feature.
2% of DOT is too big to have an issue on it.

Best Regards,

These are strong and inflammatory accusations. The treasury issue has been raised before in the Discord a couple of times, and now it has been raised in a very public way here in the Polkadot forum. I strongly suggest for the Acala Foundation team to do a factual and honest response in this forum, with evidence of where the funds are or how they have been spent, so the issue can be put aside. I sincerely hope it will not be simply brushed aside, further eroding trust in the Acala Foundation team.

Suggest transfer the parchain slot to InvArch, who would have won if the we excluded the Acala bid.

This TC proposal aims to clean up the external queue for the runtime upgrade by fas-tracking another external [motion 402](https://polkadot.subsquare.io/democracy/external/0x1d0f3803ebc21931283e3df7724944a37a75dc032497b3c69a838615ffba804e) seeking to swap leases for Acala. The following parameters have been utilised: 

- voting period: `403200 blocks` (28 days)
- enactment period: `28800 blocks` (2 days)

I voted Nay and I see as the only way to show the incompetent and non-transparent team how I feel about Acala. There was unfortunately no way to prevent them from grabbing a parachain slot. Therefore here a Nay. Acala has done more harm than good to Polkadot!

100%! Acala does not belong on Polkadot, nor does any other project that stoops to their level of incompetence and lack of respect for the community.


Acala has indeed had their share of bad events, but we should separate concerns here and limit the scope of this proposal to this proposal. They have uncovered a bug in the Polkadot runtime and that is validated by their github link.

I vote AYE on this referendum, but encourage the Acala team to start being more transparent and communicative about their history of ongoing issues!

Why weren't the 2M+ DOT raised from the "Build Acala" events sent to the on-chain Acala Treasury as promised? 

Several Acala Foundation members said the funds would be transferred to the on-chain treasury and spent transparently via on-chain governance, i.e., the funds were to be "collectively controlled by ACA holders" (Source: Dan Reecer, https://www.youtube.com/watch?v=Wh8g89OPFH8). Per Bette Chen: "2M+ DOT acquired from the Build Acala events will be transferred to the Acala Treasury within the first 4 weeks. This protocol DAO will enable self-sustainability and growth of the Acala network, all governed and managed by Acala network owners." Source: https://medium.com/acalanetwork/acala-to-initiate-its-launch-process-on-polkadot-heres-our-approach-f9f4e8cb4118.

The funds were never transferred to the on-chain Treasury and the Acala Foundation has refused to answer why. We should expect and demand better.

How can we hold Acala accountable? I encourage you to vote "NO" on the referendum until they send those funds to the on-chain Treasury and commit to spending them via community-vetted proposals passed through on-chain governance.

Why weren't the 2M+ DOT raised from the "Build Acala" events sent to the on-chain Acala Treasury as promised? 

Several Acala Foundation members said the funds would be transferred to the on-chain treasury and spent transparently via on-chain governance, i.e., the funds were to be "collectively controlled by ACA holders" (Source: Dan Reecer, https://www.youtube.com/watch?v=Wh8g89OPFH8). Per Bette Chen: "2M+ DOT acquired from the Build Acala events will be transferred to the Acala Treasury within the first 4 weeks. This protocol DAO will enable self-sustainability and growth of the Acala network, all governed and managed by Acala network owners." Source: https://medium.com/acalanetwork/acala-to-initiate-its-launch-process-on-polkadot-heres-our-approach-f9f4e8cb4118.

The funds were never transferred to the on-chain Treasury and the Acala Foundation has refused to answer why. The exploits of aUSD and tDOT are the result of unfortunate, but perhaps redeemable negligence. In contrast, the missing treasury funds are the result of straight up lying and misdirection (and thus worse IMHO). We should expect and demand better.

How can we hold Acala accountable? I encourage you to vote "NO" on the referendum until they send those funds to the on-chain Treasury and commit to spending them via community-vetted proposals passed through on-chain governance.

Hello! We’d be pleased if a member of the team would join AAG this Monday at 3:30pm UTC to help us better understand the importance of this lease swap.

Please reach out on Matrix @jay-chrawnna:matrix.org!
Thanks! 🙏

3000 DOT x 6x lock > NAY

Acala should be banned from  next auction

[@1beef0b182cf430a9ad4f0e97](https://polkadot.polkassembly.io/user/1beef0b182cf430a9ad4f0e97) Fully agree, but it looks like we are losing this one. 

Acala won their parachain auction locking up almost $1 million worth of Dot. It is only fair for Polkadot to offer a valuable service.

Rejecting this proposal sets a worrisome precedent. Polkadot should not assume the role of law enforcement or wield dictatorial powers.

Not matter if Acala is a scam - the issues with Acala should be resolved elsewhere.


This is a public referendum. How can it possibly be dictatorial?



What is fair?

Where did Acala get the $1 million worth of Dot from to secure the slot?  Were the funds mis-appropriated from the build Acala event?  If so then they have displaced another team who secured their dot-funding legitimately with real community support via crowd loans.

Is that fair?

One reason why the referendum is being voted on controversially can be found here: [https://polkadot.polkassembly.io/motion/402#8Q5Otrl9tynFoWuKWmWb](https://polkadot.polkassembly.io/motion/402#8Q5Otrl9tynFoWuKWmWb)

And in a summarizing meme also here:
![](https://images2.imgbox.com/61/ed/9CNwXi5A_o.jpg)
[click here for full size...](https://images2.imgbox.com/61/ed/9CNwXi5A_o.jpg)

By voting 'nay' you're not only punishing Acala, but also lots and lots of people who hold tokens on Acala. People with lDOT, via staked DOT on Acala, or lcDOT, via crowdfunding through Acala, would lose access to their funds, because these DOT would essentially be locked forever. 

It takes 28 days to unstake lDOT and the lcDOT are locked till October, so there's not enough time to get them off before this referendum ends. 

https://www.youtube.com/watch?v=5DM2rEWxNEU
(13:20-14:50) 

You might see this as a good thing - 2m+ DOT removed from supply!👍 - but this would be shortsighted as it would set a bad precedent and make people fearful of holding DOT👎👎!!

For the people who hold funds on Acala and the Polkadot ecosystem as a whole, it's best to let this vote go through with an 'aye' and let Acala fail on its own over time - its already doing a great job at it. 

[@JohnDoe](https://polkadot.polkassembly.io/user/JohnDoe) I have skin in the Acala fiasco, but it's a price I am willing to pay to see them go away.

Staker Space voted **AYE** on this referendum. 

First of we agree that Acala had a run of bad events that just piled up and left many KSM/DOT users angry as we never got the DeFi ecosystem we imagined Acala would be. We as a team and personally we are collators and users of Karura and Acala Ecosystem. 

Also we agree that the Acala team has not been the most transparent + quick responding team on events that happened. We certainly see other teams and ecosystems topping it with proactive behavior. I also don't know the insides, but it feels like there rigidness comes from a legal risk or future collaborations.

We do applaud the NAY voters and discussion here to get some answers and we would like to know these answers too, but it's good to separate the concerns for the sake of continuation of the chain and operations of it.  

This referendum is about a parachain lease-swap, not about Kucoin or lcDOT. Letting this referendum fail over the performance of the teams parachain is not a good look. If you invested or participated in the treasury events  + crowdloan and want to take it out on Acala team/parachain I think this is not the way of denying them the swap which the team won with an auction. 

To remind everyone the Acala team is one of the oldest contributors and builders on the substrate framework, where they contribute also tons of open source pallets(ORML) that other teams in this space relies on.

Also they are together with Moonbeam have the most active [XCM channels](https://polkadot.subscan.io/xcm_dashboard). Think what you will be denying if this vote passes. 

As last we invite the Acala team to do things differently this time. Think the perfect time to respond is now to get this referendum passed. 

Please go on AAG and explain Acala's behavior. Thanks.
(Various hacks, lack of resolution, missing treasury funds, etc)

Go on AAG and explain Acala's behavior. Thanks.
(Various hacks, lack of resolution, missing treasury funds, etc)

Go on AAG and explain Acala's behavior. Thanks.

Poor Acala.  error after error.  giving polkadot a bad name and now find itself fighting for this ref. 

So out of touch with the ecosystem, so tone def, and so unable to read the room that they sniped the auction from community favorite Invarch who is trying to bring a much needed tooling to both relays. what has acala brought?  rekt user after rekt user. thats what.    

we need a whale to nay this into oblivion.  

[@ae1b6110734242928d906ce31](https://polkadot.polkassembly.io/user/ae1b6110734242928d906ce31) In case you are wondering, the downvotes are from the Acala team - that's their game. If we can't block this ref, then the next step will be to simply just ignore them.

While I am sympathetic to the issues raised above, this referendum is related to a lease swap and an incident which arose due to a bug.  With that said I've voted Aye.

While I am sympathetic to the issues raised above, however, this referendum is related to a lease swap and an incident which arose due to a bug.  With that said I've voted Aye.

For me, I voted AYE. Although Acala has disappointed the community by not meeting their expectations and ignoring community feedback by implementing an "ostrich policy" when problems came. However, in this matter, I choose to support Acala`s proposal, because they have obtained this slot according to Polkadot's rules and they have the right to use this slot. It is not reasonable to hold ACALA responsible for the impact of their previous actions on the slot use. Moreover, doing so would also harm Polkadot's ecosystem and violate its rules.

Regrettably, Any confidence anyone had in Acala is long gone. And[ recent comments ](https://www.youtube.com/watch?v=5DM2rEWxNEU)by CTO Bryan Chen have not been able to rectify this or enable any new or continuing confidence.

![image](https://i.ibb.co/0VCxPcp/9172-Bette-Chens-Sweatty-Quim-1684470887197.jpg)

Acala already had once chance. They Fucked up - big time! You think they should have another chance at ruining the reputation of the Polkadot network?  Not on my watch.

Acala is Dead.

Regrettably, Any confidence anyone had in Acala is long gone.
And[ recent comments ](https://www.youtube.com/watch?v=5DM2rEWxNEU)by CTO Bryan Chen have not been able to rectify this or enable any new or continuing confidence.


![image](https://i.ibb.co/0VCxPcp/9172-Bette-Chens-Sweatty-Quim-1684470887197.jpg)

Acala already had once chance. Tjey |Fucked up. You think they should have another chance at ruining the reputation of the Polkadot network?  Not on my watch.

Acala is Dead.

Regrettably, Any confidence anyone had in Acala is long gone.
And[ recent comments ](https://www.youtube.com/watch?v=5DM2rEWxNEU)by CTO Bryan Chen have not been able to rectify this or enable any new or continuing confidence.


![](

![image](https://i.ibb.co/0VCxPcp/9172-Bette-Chens-Sweatty-Quim-1684470887197.jpg)

Acala already had once chance. Tjey |Fucked up. You think they should have another chance at ruining the reputation of the Polkadot network?  Not on my watch.

Acala is Dead.

Regrettably, Any confidence anyone had in Acala is long gone.
And[ recent comments ](https://www.youtube.com/watch?v=5DM2rEWxNEU)by CTO Bryan Chen have not been able to rectify this or enable any new or continuing confidence.


![](

![image](https://i.ibb.co/0VCxPcp/9172-Bette-Chens-Sweatty-Quim-1684470887197.jpg))
Acala already had once chance. Tjey |Fucked up. You think they should have another chance at ruining the reputation of the Polkadot network?  Not on my watch.

Acala is Dead.

I would like to share my point of view (sorry for my poor English). 

On one hand, I think that emotions make us lose sight of the essence of this vote, which is to amend a coding bug in Polkadot (not Acala). It must be emphasized that if this bug had not existed, this referendum would not have taken place. 

On the other hand, looks like the majority agree that the behavior of the Acala’s team has been, to say the least, quite unfortunate. Many think that Acala should not be part of Polkadot, but that does not mean we should bias our vote. 

Voting Nay means that, going forward, any project that has a problem due to coding errors in Polkadot may suffer because of the sentiment of its community. In other words, a project can be punished for things outside of it (the “punishment” will come on its own, in due time, if things within Acala don't change, but it is a different string). 

Voting Aye should not be considered as supporting Acala either, in any way. 

Let's think about what good it would do if the proposal is rejected: Acala will not be able to register its parathread in the way proposed (I don't know if it is possible in another way). We will be uncertain as to whether they will be able to extend their lease (there may be an alternative, I don’t know), but we will be certain that any project, due to a bug beyond their control, may be harmed, which seems more dangerous to me.

What is going to happen to the LCDOT [come november](https://www.reddit.com/r/AcalaNetwork/comments/zh1u1i/acala_lcdot_crowdloan_redemption_novdec_2023/)?

What is the plan regarding the [Kucoin dispute](https://www.reddit.com/r/Polkadot/comments/108uzok/whats_the_state_of_acala_currently/)?

IIUC ~24 million dot will pass into the control of the Acala team who we must then trust to return to the lcDOT holders.

Acala Foundation have registered para id 3336 and won a parachain slot auction by bidding with the intention to use the new lease to renew Acala para lease.

However, due to [bug in Polkadot](https://github.com/paritytech/polkadot/issues/7202), parachain 3336 can never produce valid block and therefore unable to perform lease swap action.

This proposal aims to perform lease swap between 2000 (Acala) and 3336 (parachain bid by Acala Foundation).

---

## Technical Details

In order to participate parachain auction, we need to register a parathread, which requires a genesis state and geensis wasm. However, it is time consuming to prepare those as the provided template project is not suitable for production usage and therefore we used a dummy wasm during registration.

Once we won the auction, we have created a new valid parachain wasm and use [`register.schedule_code_upgrade`](https://polkadot.subscan.io/extrinsic/15425400-2) and[ `register.set_current_head`](https://polkadot.subscan.io/extrinsic/15425407-2) to update the genesis wasm and genesis state for para 3336.

The state and wasm is correctly updated. However, there is an unexpected side effect. Due to bug [polkadot#7202](https://github.com/paritytech/polkadot/issues/7202), this set the upgrade go ahead signal. 

When the parachain is onboarded, the collator for para 3336 starts try to produce block but it failed with error:

`[Parachain] panicked at 'No new validation function found in storage, GoAhead signal is not expected', /home/build/.cargo/git/checkouts/cumulus-59522f43471fa161/a3d6cd4/pallets/parachain-system/src/lib.rs:396:21`

This is because parachain received the upgrade go ahead signal and expecting it is during the runtime upgrade process, which is not the case. This caused the inherent to panic.

It is not possible to rescue the parachain from this state without intervene from relaychain and therefore we proposed this propsoal.

Send a batch of dispatch calls.
Unlike `batch`, it allows errors and won't interrupt.

May be called from any origin except `None`.

- `calls`: The calls to be dispatched from the same origin. The number of call must not
  exceed the constant: `batched_calls_limit` (available in constant metadata).

If origin is root then the calls are dispatch without checking origin filter. (This
includes bypassing `frame_system::Config::BaseCallFilter`).

# <weight>
- Complexity: O(C) where C is the number of calls to be batched.
# </weight>

#119 Lease swap for Acala