Aragon DAO, a decentralized autonomous organization, has passed two votes endorsing legal action against its founding team and has earmarked $300,000 in funding for the legal battle.
The voting process garnered unanimous approval for the proposal, with 1.6 million governance tokens cast in favor, as per the voting results.
In the second vote related to funding, 1.6 million tokens were in favor, while 1 million tokens were against.
This decision follows the Aragon Association’s independent move to dissolve itself and discontinue its governance token, ANT, through redemptions for ether. The association made this decision without consulting the DAO, citing legal constraints as the rationale behind the move.
The intended lawsuit seeks to challenge a decision made without a vote by the Aragon Association and raises concerns about the potential retention of $50 million by the association.
The proposal’s objective is to hold accountable the responsible members of the Aragon Association, ensuring that investor funds are returned and not absorbed by the association’s newly undisclosed company.
To facilitate legal action and engage in negotiations with the Aragon team, the DAO has allocated $300,000 in funding to Patagon Management LLC.
Patagon, an investment company owned by Diogenes Casares, has a history of taking legal action, such as against Wei “Max” Wu in the case of Spartacus DAO, where token holders believed they suffered losses due to a similar restructuring.
The allocated funding has been transferred to Patagon’s wallet in the stablecoin USDC.
The proposal includes a provision for other individuals to contribute financially to the lawsuit. In the event of a successful outcome, these contributors will receive their funds back with a 10% annual interest rate, along with a 5% share of the total funds to be returned to token holders. However, if the case is lost, contributors will not receive compensation.
To oversee the progress of the lawsuit, an oversight committee has been established. This committee comprises representatives from the investment firm Arca, the crypto trader DCF God, and pseudonymous individuals Wismerhill, Tedward, CM, Triangular, and Yakitori.
Aragon Association Claims Majority of ANT Holders Have Redeemed Tokens
The Aragon Association has stated that a substantial number of Aragon token holders have redeemed their tokens, exceeding the number of tokens used in the recent voting process. The Association argues that this discrepancy raises questions about the full representativeness of the recent vote in reflecting the sentiments of the entire Aragon community.
The Aragon core team emphasized their separation from the Aragon Association, asserting that they hold no decision-making authority in the association’s decision to dissolve. This clarification aims to delineate the distinct roles and responsibilities between the Aragon core team and the Aragon Association in the governance and decision-making processes.
It’s noteworthy that individuals associated with the possible lawsuit against Aragon and serving on the oversight committee have been previously involved in disputes and interactions with DAOs. The RFV Raiders, a group of crypto activists, have been linked to initiatives aimed at shutting down DAOs and redistributing their treasuries among token holders.
Additionally, Aragon has suggested a connection between Avraham Eisenberg, who claimed responsibility for the attack on Mango Markets, and the RFV Raiders group. This further underscores the complex and sometimes adversarial landscape surrounding DAOs and their interactions with various entities in the crypto space.
