Christoph Jentzsch proposed the following regarding X: $ENS The DAO will dissolve itself rather than continue to operate under what he calls a broken governance structure.
“Apparently, $ENS “The DAO is broken,” he wrote, “and I would like to propose that we turn this into a victory by actually eliminating it. That goal is achieved and $ENS The protocol is in good condition and serves its purpose, and by burning the ENSv2 universal router key (set to 0x00) and distributing the remaining funds, we can officially turn it into a true public infrastructure. ”
Jentsche said he had no formal role. $ENS Governance.
The post arrived the next day $ENS Co-founder Nick Johnson single-handedly blocked an on-chain vote to update the DAO’s Security Council, backing another proposal to expand the Security Council nearly two weeks after self-delegating nearly half of the protocol’s valid vote supply. $ENS Financial management by the Foundation.
Jentzsch’s post cited a thread on delegate spengrah.eth that claimed: $ENS Labs sought to simultaneously control the DAO’s operations, the Treasury Department, and the Security Council “through the project’s founder Nick.” “DAO appears to have been captured. Voting power is concentrated in Labs and is being used to take almost unilateral action.”
Security Council vote fails as Mr Johnson casts deciding vote
The immediate trigger was the failure of EP 6.45, an on-chain proposal to update the DAO’s Security Council. EP 6.45 is a 4/8 multisig empowered to cancel malicious proposals that have already passed governance and entered the timelock queue. The council’s mandate was scheduled to expire on July 24.
The update went through two stages. One was an off-chain snapshot vote and passed. The other was a binding on-chain executable vote that did not pass. Mr Johnson abstained in the snapshot vote, posting that he supported renewal but not “with the current membership” and voted against the binding vote. As of June 30, on-chain voting was 82% negative, according to vote.ensdao.org, and the vote is scheduled for July 5 at 8:59 PM ET.
Mr Johnson controls an estimated 3.26 million people. $ENS Tokens — approximately 80% of the votes cast in that election and approximately half of all votes. $ENS Currently delegated to any address.
Hours after the vote failed, $ENS Labs Chief Operating Officer Katherine Wu posted a draft of the Succession Council. They include eight members, a stricter five-out-of-eight standard for canceling proposals, a published obligation to limit vetoes to “malicious, coercive, or exploitative governance attacks,” and a legal appointment agreement. $ENS foundation of each member. Nominations close on July 3rd. Citing the DAO’s 87% participation rate, Johnson made his own nomination to the forum, writing: “I agree with the mandate and charter of the new Security Council and will act only in accordance with it.”
Root Cause: Foundation Treasury Proposal
The Security Council dispute grew out of an earlier dispute. On June 19, Wu released a proposal for a temporary check called “The Next Era of Staffing.” $ENS DAO: Empower $ENS Foundation”, which changes the DAO’s operational wallet. $ENS Token holdings and donations to 5 seats managed by Karpatky $ENS Foundation Committee — Proposed to include two committees $ENS According to The Defiant, the lab’s members include two Aragonese members and ETHGlobal founder Kartik Talwar. The proposal would retain token holders’ authority over protocol upgrades and pricing while transferring day-to-day financial operations and grants to the foundation.
On June 22, Prime Minister Boris Johnson said he would self-devolve. $ENS Assets held to support this measure. Participants said the move gave him effective control over the DAO’s outcomes. Rotki founder Lefteris Karapesas wrote in a governance forum that Johnson “delegated approximately 50% of the vote supply to himself, effectively becoming the DAO… After all, the DAO no longer exists because Nick now has all the voting rights.”
Security Council member Brantley Millegan called the proposal “akin to a government takeover of the Treasury.” $ENS Labs said that if it were to pass over community opposition and based primarily on a vote coordinated with Labs, it would be “by any common definition an attack on governance” and prepare for a Security Council veto.
Netto.eth, leader of the Metagovernance Working Group, wrote that the composition of the board “indicates the downfall of governance.” $ENSAfter the June 30 vote, Karapetsas wrote on X that the DAO was “dead,” and Ethereum commentator colludingnode changed his display handle to refer to the alternative naming service .gwei and wrote, “If a crisis like this even remotely possible, it’s not good enough for Ethereum.”
The size of the Treasury and the Protocol
The fund has been managed by Karpatky since the November 2022 DAO vote and was seeded with an initial 16,000 participants. $ETH According to March 2023 $ENS Governance Forum. As of Mr. Karpatkey’s latest public report, approximately 71% of DAO funds are held in endowments, with the remainder in operational wallets and registrar-controller agreements.
$ENS It traded at around $4.33, giving it a market cap of nearly $175 million, according to CoinGecko. It has fallen about 95% from its peak in November 2021, when the token’s airdrop-driven debut briefly boosted it. $ENS The market capitalization reaches $1 billion.
Previous governance controversy
$ENS DAO was established in November 2021 by Johnson and True Names Limited, a Singapore-based non-profit organization that has historically provided a variety of services. $ENS In parallel with the token airdrop distributing 1/4 of 100 million. $ENS Available to owners of .eth domains registered by October 31, 2021.
DAOs have faced governance controversies before. In February 2022, True Names Limited terminated Mr Millegan’s contract as managing director after tweets from 2016 in which he expressed views condemning homosexuality resurfaced.
A subsequent DAO vote determined whether to remove Millegan from her other role as a state employee. $ENS The dismissal of the foundation chairman was rejected with 43.4% against and 37.5% in favor. Mr. Millegan remained an active DAO participant and Security Council member throughout the current conflict.
Both the Security Council renewal and the Foundation’s extraordinary inspection remain outstanding. Voting for the on-chain security council ends on July 5, and the nomination period for a successor council ends on July 3, but subsequent votes have not yet taken place. The Foundation’s temporary inspection has not yet transitioned into a formal snapshot vote. Jentsch’s dissolution proposal has not been submitted as a formal governance item. $ENS You can participate in forums and participate in DAO polls. The Defiant previously reported on the widespread conflict that erupted in late June.
