Aragon Fires Back at Activist Investors in Early Stages of DAO Governance Fight

Aragon’s key backers doubled down on their controversial banning of Discord members, arguing in a Friday blog post that the decentralized crypto governance project can be a DAO even if its town square is on lockdown.

“Discord servers and other trusted coordination platforms are tools used by DAOs, but they themselves are not DAOs,” wrote the Swiss nonprofit Aragon Association in a statement circulated via Aragon’s weekly newsletter. The statement served to justify Aragon’s exile of at least half a dozen community members for “spamming” Aragon’s Discord server with questions over its finances.

The response escalated a brewing fight between Aragon and a cadre of activist investors who have taken interest in the project’s ANT token and multimillion-dollar treasury. But the nature of Aragon’s response also raised thorny questions over proper implementation of crypto governance itself, the subject at the center of the Aragon project.

A DAO, or decentralized autonomous organization, is a method of governance in which crypto investors vote to decide how a project is run. Aragon builds tools to help other DAOs operate and is itself partially governed by a DAO. This week it began moving its treasury toward community control, an effort nearly a year in the making.

While governance decisions over those riches will happen via votes on the blockchain, it is on Discord and project governance forums that members of Aragon’s community – like those at nearly every other DAO – organize their thoughts and coordinate action.

On Wednesday Aragon insiders booted people whose speech was deemed detrimental to the community. Many – but not all – of the members it exiled are aligned with crypto’s underground activist investor movement, the RFV raiders, who have taken an interest in Aragon. In its Friday blog post, Aragon declared it would stand firm against them.

“The AA will continue to carefully and empirically pace our decentralization to ensure that individuals and groups cannot use ANT for personal profit at the expense of building the technology which ANT is intended to govern,” the Aragon Association said.

The Aragon Association gave no timeline for future efforts to move its treasury to community control. This week’s governance debacle had concluded with the mass banning and an announcement that Aragon had moved $300,000 of a nearly $70 million treasury to a wallet that the DAO will ultimately operate.

It also gave no timeline for reinstating the banned members to Discord, some of whom told CoinDesk they were also booted from Aragon’s governance forum.

One exiled observer who asked not to be named told CoinDesk the Aragon fight was just getting started.