DAO Suddenly Cancels Plans to Donate 100 ETH to 'On-Chain Sleuth' ZachXBT
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DAO Suddenly Cancels Plans to Donate 100 ETH to 'On-Chain Sleuth' ZachXBT

3m
1 month ago

On Twitter, it was suggested this action may have been taken by someone who wanted to stop ZachXBT from performing further investigations.

DAO Suddenly Cancels Plans to Donate 100 ETH to 'On-Chain Sleuth' ZachXBT

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Confusion is swirling within a decentralized autonomous organization (DAO) after plans to donate 100 ETH to a well-known, on-chain crypto sleuth were suddenly canceled.

Nouns is a project that releases a new computer-generated artwork every 24 hours — and every person who wins an auction for one ends up becoming a member of its very own DAO, which also receives 100% of the proceeds.

Members of the community had voted to donate the lump sum — worth $128,000 at current market rates — to ZachXBT, rewarding him for his work in uncovering crypto scams. The proposal was first initiated by Hong Kim, the co-founder and CTO of Bitwise Asset Management.

Just some of ZachXBT's scoops this year include releasing a spreadsheet that showed how much major influencers allegedly charged to promote crypto projects — and an investigation claiming Lark Davis promoted low-cap altcoins to his audience, only to dump them shortly after.

ZachXBT had said he was grateful for the donation, writing:

"It will mostly remain unspent in case the bear market lasts for an extended period of time. Also plan on hiring a dev intern in the coming months. Potentially will upgrade some of my equipment too."

All seems in order so far. But things soon got a little murkier after it emerged that the proposal had been abruptly canceled — meaning the funds were not sent to ZachXBT.

Governance client House of Nouns claimed a technical quirk meant the proposal could be canceled by an anonymous wallet — and on Twitter, it suggested this action may have been taken by someone who wanted to stop ZachXBT from performing further investigations.

Undeterred, it confirmed that a new, identical proposal has been created to ensure that ZachXBT receives this 100 ETH reward — and House of Nouns added that it is a "near certainty" that the vote will pass once again. Further explaining what happened, Hong Kim wrote in the newest proposal:

"I had delegated my nouns to the House of Nouns team without knowing that until a prop reaches execution (even after voting passes) removing voting power from the proposer's address can mean that anyone can cancel the prop. Unfortunately it was canceled as a result. My sincere apologies for the need to revote."

Why Is ZachXBT Receiving This Cash?

Hong Kim argued that ZachXBT "is a public good serving the ecosystem through tireless research exposing countless scams" — adding:

"Recent events have highlighted the dire need and importance of such work."

But they acknowledged that giving donations to individuals can prove controversial in the event that there's a conflict of interest — and said one doesn't exist here.

"I attest that I have no prior (or planned future) relationship with ZachXBT and that today was the first time I contacted them (via Twitter) to ask for their permission to make this proposal."

House of Nouns has expressed confidence that ZachXBT will receive their reward "in about a week" after voting ends.

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