Treasury Statement

This week’s edition of The Eagle is a statement from the Aragon Association (AA), in collaboration with the Operations and Growth Guilds of the Aragon DAO.

This week there was a spam attack in Aragon Discord channels and DMs to contributors, by anonymous users applying pressure to speed up the transfer of funds from the AA to the Aragon DAO. Although claiming to be long-standing community members, Discord analytics demonstrated that these were largely new and coordinated users. We decided to temporarily ban the most aggressive users, some of whom were using offensive language. CoinDesk reported these users were connected to the financial takeover of Rook DAO.

This week the AA also executed an initial transfer of 300,000 USDC to the Aragon DAO. However, the AA has planned only for additional transfers of its treasury if they are to fund the development of decentralized governance technology and if the financial incentives make liquidating it for personal profit unviable.

What Happened

On May 2, there was a sudden and suspicious uptick in Aragon Discord server activity and our moderators became concerned this activity was coordinated. Upon closer look at the Discord analytics of the suspected users, we found that on average:

• The group had joined the server less than 45 days earlier (for context, the server has been in operation for over 5 years);

• Over that time period, the group posted less than 1 message per day (0.8); 

• On May 2, the group posted over 69 messages within hours.

We concluded these users were not community members and were coordinated. We therefore took action by temporarily banning users suspected of coordination and spamming in order to investigate further and keep the community safe. 

In response to our action, Coindesk reinforced our suspicions when they reported the following: 

One common thread: Every banned member that CoinDesk spoke to is also a member of ROOK, which last month dissolved its DAO after activist investors called for the project to return capital to its token holders. This happened through a series of votes pertaining to its on-chain treasury.

Our Actions and Position

Even if temporary and justified, we do not take lightly the action of banning users on the social platforms we use for trusted coordination, such as Discord and Discourse. The Aragon Project has been, from its inception, focused on building trustless, permissionless, and censorship-resistant governance technology. This governance, first and foremost, happens onchain. It is also why, in the Aragon DAO, we put code at the center and humans at the edges. Wallet addresses holding ANT can always wrap ANT and participate in Aragon DAO governance by putting forth proposals, voting, and executing transactions.

Discord servers and other trusted coordination platforms are tools used by DAOs, but they themselves are not DAOs. They are subject to moderation and applicable rules of conduct. At Aragon, those responsible for moderation have the responsibility to protect the teams, builders, and community on our platforms. Hosting spaces for governance dialogue is important, but incessant and coordinated spamming in an attempt to create a hostile environment isn’t productive and can truly be damaging to the success and mission of the project.

With regards to the events in Rook DAO, CoinDesk reported the following : 

Rook DAO is dead. But its riches are alive – and available to be claimed by ROOK token holders for the next 90 days.

The former governance token has become a ticket to redeem around $25 million of the treasury that once belonged to Rook DAO, the defunct governing body whose members now run a new entity that only exists to liquidate the cash.

In light of the coordinated pressure to move treasury funds, and the connection to the liquidation of Rook DAO, it is equally critical to reinforce that the Aragon Network Token (ANT) is not an investment token. It is a utility token intended to have full control over the governance of onchain products and protocols built by Aragon. The intention for ANT was always to have utility in the technology we build, by giving ANT Holders permissionless, trustless, and censorship-resistant control over public infrastructure serving the Ethereum ecosystem and society at large.

This is an enormous undertaking, one that multiple teams have been working towards for many years. We are grateful to the community of ANT Holders and builders that share the values of the Aragon Manifesto and contributed to advancing its mission. With successive iterations of Aragon smart contracts, our technology currently secures the governance of over 12B in TVL for the Ethereum ecosystem. We continue to build on these successes and learnings, and recently deployed our new tech-stack: Aragon OSx and Aragon App. 

As we build this technology, we have remained steadfast in our commitment to progressively decentralize the governance of the Aragon Project. This effort has seen many iterations, such as the AGP process, the Aragon Network DAO (AN DAO), and the current Aragon DAO. These trials and tribulations are necessary to discover successful and sustainable onchain governance models – not only for the Aragon Project, but for the industry as a whole. 

ANT Holders will have control over Aragon’s infrastructure and treasury over time, but progress is still to be made towards battle tested security, incentive-aligned trustless governance mechanisms, balanced financial incentives between the value of ANT and the treasury, and strategic allocation of governance power across the ecosystem.

Reckless attempts at decentralization would risk interception of treasury funds for profit, jeopardizing the Aragon Project’s ambitious mission, and exposing ANT to scrutiny by regulators who are working to protect citizens from unscrupulous and exploitative financial practices.

As the custodian of the treasury and critical infrastructure, the AA was tasked with upholding the purpose of the Aragon Project and the original intent for the distribution of ANT : 

...to disintermediate the creation and maintenance of organizational structures using blockchain technology to build the necessary software infrastructure and tools. These tools and infrastructure empower developers to build functionality and applications for the next generation of decentralized organisations and give people across the world the opportunity to easily, transparently and securely manage their organizations, enabling a borderless, permissionless and more efficient creation of value.

Thus, the treasury will only be transferred under conditions of reasonable assurance that the funds will go to developers, DAO builders, and the growth of the infrastructure, in alignment with the purpose of the Aragon Association and the Aragon Manifesto. This most recent attempt at pressuring Aragon to decentralize funds rapidly will not work. To attempt it through social engineering attacks is a misunderstanding of the current state of the Aragon Project, and is also just unacceptable.  

At this time, wANT Holders have signaled their endorsement of the 2023 Annual Strategy Guideline, based on the Strategy to Become a Governance Hyperstructure. This alignment helps the AA ensure that the funds are directed towards its mandated purpose and Aragon’s mission: giving builders the resources to build decentralized governance infrastructure. 

The AA will continue to carefully and empirically pace our decentralization to ensure that individuals and groups cannot use ANT for personal profit at the expense of building the technology which ANT is intended to govern.

We are here to build. 

We are here for the builders. 

We are here to build better, together.