Table of Contents:

· Aragon DAO: Lawsuit aims to hold AA members accountable and protect investor funds

· AA: Proposal initiators spread "baseless accusations" for personal gain

· Community: Aragon's true innovation lies in finding all the ways governance can go wrong

· The largest DAO platform in history faces frequent governance challenges this year

The Aragon DAO, once hailed as the "largest DAO platform in history," passed a vote yesterday to take legal action against Aragon Association (hereinafter referred to as AA), the legal manager of the Aragon Project.

November 21st, according to the official website of Aragon DAO, the Aragon DAO community has passed two votes to support Patagon Management LLC, a cryptocurrency trading company in Delaware, USA (hereinafter referred to as Patagon), in suing the Aragon founding team. At the same time, they also provided 300,000 USDC to support Patagon's legal proceedings.

In fact, there have been clues about this vote for a long time, and the source of controversy is AA.

Aragon DAO: Lawsuit Aims to Hold AA Members Accountable and Protect Investor Funds

AA can be said to be the legal guardian of the Aragon project, responsible for managing the funds raised in the Aragon network token sale. According to the official website, Aragon's founders Luis Cuende and Jorge Izquierdo respectively serve as members of the Aragon Association's committee and executive director.

Left: Jorge Izquierdo; Right: Luis Cuende

It is reported that this vote is in response to the previous action of AA - AA had previously dissolved in place through ETH redemption, and terminated the operation of governance token ANT.

At the same time, the proposal states that others will also be able to help fund the lawsuit. If successful, Aragon DAO's community members will recover the funds and receive 10% interest annually. They will also share 5% of the total funds and return it to token holders. However, if the lawsuit fails, they will not receive compensation.

In addition, the lawsuit will be supervised by a supervisory committee composed of representatives from investment company Arca, cryptocurrency trader DCF God, and other individuals using aliases such as Wismerhill, Tedward, CM, Triangle, and Yakitori.

In the detailed document on the voting page, it is displayed that on November 2nd, AA unilaterally closed Aragon's governance token ANT without going through the voting process. At the same time, AA provided a redemption plan for about 95% of BV, but retained $11 million as "obligations" and unclaimed funds after one year, which put holders in a difficult situation.

Approximately 25-32% of holders have not claimed their funds. They will retain the remaining funds of over 50 million USD and only return 60,000 ETH (about 22%) of the initially raised 275,000 ETH to investors.

In addition, the file provides more detailed information indicating that the proposal aims to determine whether to initiate the process of holding AA responsible members accountable, in order to ensure that investors' funds are returned to them rather than being taken away by the Aragon team.

It is worth noting that Patagon, who was nominated by Aragon DAO as the plaintiff to sue AA, had previously issued a 24-page investigation report on August 11th, pointing out that AA had considered "selling the project" to an undisclosed bidder in June at an unknown price.

This report also accuses Aragon of wasting various encrypted assets worth $180 million and questions whether the organization is complying with Swiss non-profit laws.

AA: The proposer is spreading "unfounded accusations" to seek personal gain

Regarding the adoption of this proposal, AA also made a positive response on November 22nd, stating that if necessary, they will respond to the lawsuit, while believing that the proposer has been spreading "unfounded accusations" and threatening to sue Aragon to maximize personal profits, and these accusations are false: "If necessary, we look forward to proving in court that they are unfounded."

AA pointed out on social media that the initiators of this proposal are "several accounts claiming to be RFV Raiders", and these accounts do not represent a larger group of ANT token holders. At the same time, due to AA using 87% of its funds to allow all ANT holders to exchange their ANT for ETH, over 11.1 million ANT have participated in the redemption.

By contrast, only about 1.6 million ANT were voted by these accounts and the proposal passed: "Interestingly, after the DAO vote, several of these accounts immediately participated in the redemption process."

Community: Aragon's real innovation lies in finding all the ways governance can go wrong

Regarding the issue of events and the long-standing problem of Aragon DAO, there are various opinions within the cryptocurrency industry community, but without exception, they all focus on the governance dilemma of DAO.

Investor and community KOL DCF GOD (@dcfgod) in the encryption industry pointed out: "This is crazy. The Aragon Project DAO has voted in favor of directly suing the Aragon team for unfair redemption offers. This may be the first time that a DAO has paid to legalize its own team?"

Synthetix founder Kain Warwick (@kaiynne) also commented: "The real innovation of the Aragon project is finding all the ways governance can go wrong. They say DAO governance is chaotic and dysfunctional, perhaps not all the founders of super voting power are paranoid..."

It is interesting to note that Jorge Izquierdo, the founder of Aragon (@izqui9), updated his social media account on November 21, the same day that Aragon DAO proposed to sue AA.

Jorge forwarded a comment from Y Combinator founder Paul Graham (@paulg) regarding recent developments in the OpenAI board. In the post, Paul stated that the idea of a standoff between three board members and 95% of the staff was "unprecedented" and so unusual that it almost seemed wrong: "I never imagined such a thing was possible. If 95% isn't a vote of no confidence, what is?"

This may also reflect Jorge's thinking on governance challenges to some extent.

史上最大 DAO 平台今年频出治理难题

The largest DAO platform in history has encountered frequent governance challenges this year.

In fact, Aragon is a decentralized governance solution for the Web3 community and organizations, and is also the largest DAO platform in history, having been established for 6 years and once managing over 900 million US dollars in assets. Aragon has made great contributions to the development of the DAO industry, for example, developing aragonOS - a DAO framework that experiments with governance at software speed, providing support for Ethereum-based DAOs such as Lido and Curve.

Related reading: "Aragon, the largest DAO platform in history, dissolves its committee, providing governance inspiration for all practitioners".

However, this platform and its legal manager AA have been experiencing continuous problems since this year. For example, on May 10th, AA announced the cancellation of the voting rights of ANT token holders, which includes the decision-making on the strategic direction of Aragon's future development and the use of hundreds of millions of dollars in funds.

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