Attack on Aragon: Decentralization or Deception?
Attack on Aragon: Decentralization or Deception?
The Tally Newsletter, Issue 97
Welcome back to the Tally Newsletter, your weekly source for DAO governance insights. I'm coolhorsegirl and I’m so stoked to be here. 🟣
The governance tea is hot this week. An attempted token gov takeover has not only shaken Aragon's foundations, but it's also prompted some serious soul-searching about the essence of a DAO, the relationship between a DAO and its legal wrapper, and how to handle such attacks. Apology threads by protocols are a rarity, and in this case, one was more than warranted. Yet, Aragon's apology may be a band-aid for a self-inflicted wound, as they try to backtrack from the missteps that landed them in hot water. Trust me, this is a drama you can't afford to skip.
As for proposals, Gitcoin is heading into Season 18, Uniswap is continuing chain expansion of V3, and Nouns and its offshoots have many a proposal on the table, including some pretty cute action figures. Let’s get into it 👇
🤿 Deep Dive: Attack on Aragon
Draaaaaaama. TL;DR: DAO governance platform Aragon’s new DAO encountered a governance attack and their response may have caused more issues than it solved. Aragon (temporarily) turned its back on the ethos of a DAO - decentralization. They’ve since tried to rectify the situation, but it's clear they stumbled. Has the damage been done? Let's unpack this mess.
Rewind to June 2022: ANT (Aragon’s governance token) holders voted for the Aragon Association (AA) to shift their hefty treasury (~$200m) into a delegate-voting DAO. The DAO was launched this February, with the AA planning to start the treasury transfer with an initial 300k USDC last week. That’s where the trouble began.
Just as the process kicked off, the AA noticed some sketchy Discord activity from a group called Risk-Free Value (RFV) Raiders, the same group that pulled a fast one on Rook DAO. A sudden change in wANT supply in the DAO signaled that RFV was attempting to buy up enough governance tokens to repurpose the DAO treasury. Aragon, with more treasury transfers in the pipeline, found itself in a tight spot.
Here's where it goes from bad to worse. In a blog post, the AA announced, “Aragon DAO has been repurposed. It’s now Aragon Grants DAO.” Repurposed? Really? By shifting the mission of the DAO, the AA found a way to send subsequent funds only for a grants program, while still maintaining a veneer of treasury decentralization. The scheme was simple: RFV wasn’t doing a Grant-deserving activity (like building on the Aragon dApp), so they'd be disqualified from getting funds even if they pulled off their buy-up. Sneaky move, Aragon. So, the Aragon DAO was hastily repackaged as the Aragon Grants DAO.
The quick fix ushered in a storm. The RFV issue was sorted, but anger among the community began boiling (and still is, tbh). Was the Aragon DAO ever really a DAO if the AA could just "repurpose" it with a casual blog post? The Twitterati stormed Aragon with well-deserved accusations of their new DAO being a sham – decentralized in name only (or "DINO," if you will).
Aragon has since backtracked, saying that repurposing the DAO was a misstep, and that everything in the DAO is governed by ANT holders, not the AA. They assured that in case of another attack, the AA could halt future transfers but wouldn't meddle with transfers to the DAO that have already been made (as they did this time around)
In an attempt to mend fences, Aragon apologized, stating, “Our communication made it seem like the Aragon DAO is stoppable, that’s not true.” They've promised to continue the transfers as planned and are encouraging debate on their forum. Yet, the sense of trust is undoubtedly shaken. The tea, my friends, remains piping hot.
⌛️ On-chain Proposals
On-chain DAOs are decentralized autonomous organizations that operate entirely on the blockchain, using smart contracts and other blockchain-based technologies for its operations and decision-making processes. Tally believes that true DAOs operate on-chain.
💚 Gitcoin
Summary: Allo is focused on establishing product-market fit for web3 grants programs. This season, they’re focused on 2 things: enabling these programs to run their funding through Grants Stack and improving the composability of Allo Protocol. Asking for $1.6M worth of GTC.
Voting ends: May 20th
S18 Gitcoin Passport Workstream Budget
Summary: Passport workstream is all about increasing adoption this season (by at least 5x), and with that, revenue (at least $1). This will involve market research, testing, and a big marketing push. Asking for $1.3M worth of GTC.
Voting ends: May 20th
🦄 Uniswap
Deploy Uniswap V3 on Moonbeam (2023)
Summary: Following a temperature check with ~100% voting YES, going onchain to confirm GFX Labs’s technical deployment of Uniswap V3 contracts on the Moonbeam using Wormhole.
Voting ends: May 17th
🚊 Public Nouns
Web3 Work: A Study of DAO Labor from Other Internet
Summary: 20 ETH grant to run a 6-month-long initiative of research on DAO labor, including working sessions, governance proposals based on findings, and an open-access report.
Voting ends: May 17th
🟡 NounsDAO
🇧🇷 NFT.Brasil - Taking Over São Paulo and Celebrating the Brazilian Community
Summary: $90k to sponsor NFT.Brasil, lounge and exhibition included. And a whole lotta swag.
Voting ends: May 17th
Nouns Wet Wipes V2 - Vote for your favourite Design!!!
Summary: 31,450k + 2ETH to create the first Nouns-branded Fast Moving Consumer Good (FMCG). Bringing Noun Wet Wipes to the masses, one pocket at a team. Design mock-ups included.
Voting ends: May 18th
Summary: $125k to fund 3”-tall mini-figures meant to be a “fun, stylish, low-cost, and non-crypto-based entry point into the worlds of NOUNs.” From Prop 72 and Prop 141, the project has been funded and communicating updates in Discord.
Voting ends: May 19th
100 Nounish Things: a nounish droposal ⌐◨-◨
Summary: Deploy an open-edition mint of the music video “100 Nounish Things” that highlights some of the biggest people, places, and things funded by Nouns.
Voting ends: May 19th
retain nounish for 6 months ⌐◨-◨
Summary: A hefty one. This proposal will fund nounish’s—a video production agency—continued work for Nouns for 969K USDC. With that money, included content plan would be carried out. Nounish boasts 3M @nounish socials views already.
Voting ends: May 20th
Nouns Chinese Socials: 6 Month Pilot
Summary: ~63 ETH for a 6-month pilot (paid via monthly streaming) of SCG Group, a digital agency, to empower China’s digital communities to learn and contribute to the Nouns ecosystem. Multiple platforms, 5+ posts per week, and travel to China to support the local team.
Voting ends: May 20th
📝 10 Things To Read or Listen To
📄 “Delegate Activity Tracker” by Karma (unveiling)
📄 “Gitcoin: Who makes the decisions anyway?” by shawn16400
📄 “The Many Lives of a Nouns DAO Proposal” by Wilson
📄 “The Opportunities and Limits of Nounish DAOs” by Chris Carella
🧵 “The broader an organization’s scope is, the greater he coordination cost required“ from pet3rpan
🧵 “Modeling Token Networks” from pet3rpan
🎧 “Decentralized Knowledge Sharing w/ Sari Azout” on Rehash
🎧 “‘Micromedia’ is the future | Yana Sosnovskaya, Zora” on Boys Club
🎧 “Stephen Wolfram: ChatGPT and the Nature of Truth, Reality & Computation” on the Lex Fridman Podcast
🎧 “Protocol Guild: 1 Year In with Time Beiko and Cheeky Gorilla” on GreenPill
💫 DAO Talk: DAO to the future || DT weekly #39
🤭 Meme of the Week
Some quickies from Tally: Delegation Week is NEXT WEEK. There’s still time to register as a DAO, delegate, or voter. And hey, this newsletter comes out on Tuesday mornings now instead of Mondays. See ya next week :)
~ coolhorsegirl 🐴
p.s.- Made it to Vietnam! Finally, freed from Malaysia. Enjoying the pool and the heat. And I’m trying a new fruit every day!! My favourite so far has been the dragon mango.
