A new chapter for the Aragon Project

Hi everyone,

I am sharing an important update for all stakeholders of the Aragon Project, on behalf of the AA.

The AA has passed the following resolution:

  1. Deploy most of the treasury to allow all ANT holders to redeem their ANT for ETH;
  2. Dissolve the AA;
  3. Continue the mission in a product-focused structure.

Token holders can redeem their ANT for ETH at a fixed rate of 0.0025376 ETH / ANT. The AA is deploying 86,343 ETH to a redemption contract for this purpose on Ethereum mainnet. Token holders can participate in the redemption here. The smart contract deployment in Etherescan can be consulted here.

The AA arrived at the best redemption rate it could achieve for all ANT holders by identifying the most compliant and tax efficient path forward allowing for the continuation and protection of the project. This decision could not be put to a public vote due to legal constraints, specifically regulatory risks triggered by token speculation and market manipulation. The discussions in the Aragon Forum were considered in the decision.

Please read the full announcement here.

Hi Joan, thanks for the (much awaited) update.

Few questions:

  • What is covered in the “outstanding obligations and regulatory uncertainty”? You must have had a review of this by a lawyer and an agreement by the Zug tax office before estimating this, so I’d be happy to see you posting the relevant info here.

  • Can we have a last transparency report? Or have we abandoned all hopes of fairness here?

  • Around 25% of ANTv1 tokens didn’t migrate. Those tokens are probably lost, meaning that a lot of the remaining ETH, which should be owned by the DAO, will be lost. This is in practice a disguised subvention to the new org. At least, the 11M$ set aside (granted it’s justified) could be taken from those 25%, rather than taken on the head of the remaining active holders.

It’s a loss (or, I would say, a THEFT, with all the legal implications) of 21,500 ETH, which is significant, not for everyone though, as it allows “business as usual” to continue for the spoiled kids of the ICO world. 50M$ in total + the 11M$ for “uncertainty” (sic)

  • Funds were supposed to be transferred to the DAO. Now, because insiders in closed doors decided otherwise, it won’t be the case any more. Ahem?

  • The DAO has lost 189,000 ETH in various errands, as was pointed out in the announcement. Yet, there is still a plan to continue without changing anything. We still have the same team, which while composed of probably bright devs, failed to push useable products with a market fit, and a “Product Council” which will, without any doubt, recreate the hostile insider capture that doomed AragonDAO.

As a sidenote, I find quite remarkable that a DAO-maker team says that its DAO is useless. It’s pretty telling of the lack of fairness of the AA. ANT holders are your first users, you dump them, why would other teams trust you?

Pasting those wise words for eternal fame.

I’m sure other community members will have other comments to add.


I think a good starting place is to see all relevant documentation around the agreements for the 11m liability - then start by giving us a reason for why you think the aa deserves $50M without any vote and oversight?

For the matter of transparency for holders - since Aragon Association is committed to providing none - sharing the following.

86343 ETH has been set aside for redemption, and the rate is 0.0025376 ETH / ANT. This implies a backed supply of ~34,025,457 ANT.

Aragon is an old project in crypto terms, being found in 2016. As a result there is significant dead supply. Currently as of November 2, 2023, 9,101,767 ANT tokens remain in the ANTv1 migration contract, and a further 133,427 tokens remain in the sANT migration contract, for a total of 9,235,194 ANT, or ~27.14% of backed supply.

These migration contracts were created in 2020 to migrate over to the new ANTv2 token that is used today; it is very likely that if these tokens have still not migrated, they are dead and will not participate in the redemption. For reference, the balance in the migrator contract one year ago (11-02-2022) was 9,559,280 ANT, which means just 4% further migrated over the past year:

This 9 million ANT is a proxy for the amount of supply that is dead onchain, but being an older token that existed before much of Defi, a significant amount of ANT is held on exchanges too. Over 7 million ANT was migrated automatically by exchanges in 2020, and could also hold a large number of dead supply:

This redemption - live for one year - sends all unclaimed funds to OSX to further the development of the project, with tokenholders receiving no equity in this new project. In addition, 11 million USD was set aside for legal and regulatory costs, and will also be redirected to OSX if unspent.

It is hard to imagine less dead supply less than 25% given the information above. That would mean 25% * 86343 ETH * [1800 (current ETH Price)] ~= $38.85 million would go unclaimed to OSX. Adding the 11 million USD for legal and regulatory, nearly $50 million belonging to ANT holders would go to a project ANT holders have no option to receive stake in, as clearly mentioned in the blog post:

The $50 million number would increase to $57m - $73m if the unclaimed portion assumed increases to 30-40%.

The team, in addition to receiving what is likely ~50m+ USD and stake in their new project, appears to be able to “double-dip” and redeem their own ANT tokens. Wallets of identified team wallets own at least 1.5 million ANT, meaning the team will be taking at least an additional ~7 million USD at current ETH prices.

As it stands, this so-called “redemption” amounts to the Aragon Association, without vote (and in fact, in violation of previous voted-upon directives), donating to themselves a substantial portion of the treasury that belongs to tokenholders. No vote was ever upheld to donate to this spinoff project belonging to insiders, and no equity in this spinoff project is being given to ANT holders who have helped fund it to the tunes of tens of millions.


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Hi everyone,

I’d like to provide a clarification update on the AA’s resolution and to address specific questions that have been raised regarding the ANT Redemption Initiative.

Clarification on Tax Obligations with Zug Tax Authorities

The AA was incorporated as legal entity in the canton of Zug, Switzerland. Its taxation was defined by a binding tax ruling that was granted by Zug tax authorities. The historical tax ruling that AA had was a favorable taxation, as long as the expenses were aligned with the entity’s purpose.

The AA diligently worked with the Zug tax authorities to ensure that the redemption initiative aligned with current tax regulations. Through careful planning and legal consultation, the AA secured a new tax ruling that allowed it to proceed with the redemption while minimizing the tax burden and guaranteeing project continuity. This was a crucial step to maximize the funds available for the ANT holders’ redemption and ensure the project’s continuity. Without this explicit, binding and stamped tax ruling, the taxation of any ANT Redemption initiative would have resulted in a massive reduction of the funds available for the redemption.

Clarification on ANT Redemption Initiative structure and target rate


The AA’s decision to proceed with a single redemption round at a fixed rate was bound by specific tax and legal constraints. The AA evaluated executing a second round of redemption. However, a second round had to be ruled out for the following reasons:

  1. Risk of re-qualification as a Security (asset tokens): This would likely be the case if a second redemption round were pre-announced as a given action (implying a legal claim). If that re-qualification happened, no entity could engage in any second ANT redemption round without having a securities firm license (which neither AA, nor ASF, nor Eagle Association hold), otherwise they would incur serious liabilities.
  2. Risk of qualification as a Collective Investment Scheme: Collective investment schemes within the meaning of the CISA are assets collected from investors for collective investment, and which are managed (by third parties) for the account of such investors. If that qualification came into effect due to the consideration of AA managing those assets (under an assumption based on the promise to repay those assets), and the AA engaged in multiple redemption rounds or offered a payout significantly above the market rate, those actions could be viewed from an economic perspective as a collective investment. In that case, the AA would have had to pay a 35% withholding tax on the funds allocated to the redemption smart contract. That would have significantly reduced the total assets available for redemption as the total taxation for the ANT redemption initiative would have been up to $82M (at $/ETH rate of 02.11.23), and likely resulted in enforcement actions against anyone involved by the financial market regulator

By executing the initiative in a tax-compliant manner, the AA was able to maximize the ETH:ANT rate, having a final tax cost of just $1.4M as opposed to $82M.

Target rate

The ANT Redemption Initiative approved by the new tax ruling targeted 100% of the outstanding circulating supply as its objective is to eliminate all the circulating supply of the token. For this reason, it was mandatory to provide an equal and fair opportunity to all ANT holders to participate in the redemption. The AA could not exclude any ANT holder based on arbitrary parameters nor assumptions of redemption participation over the 12 month initiative, which are not possible to know in advance.

Clarification on successor non-profit and use of any potential leftover funds

As explained in the announcement, any potential leftover ETH in the ANT redemption contract will be automatically sent to a successor Swiss non-profit association (named Eagle Association) and allocated by the Product Council.

Changes to the Eagle Association’s purpose, name, or operational rules require a two-thirds majority vote and the consent of the Aragon Shield Foundation. The Aragon Shield Foundation, also a Swiss entity, acts as a protective body for the Aragon Project, also safeguarding funds to fulfill outstanding obligations and mitigate against regulatory uncertainty. It operates under strict guidelines, with its purpose and organization detailed in a notarial deed, overseen by the Swiss Foundation Supervisory Authority. The foundation’s role is to ensure that assets are used in line with its mission to support the Aragon Project, and it cannot be altered without regulatory approval.

As a result, all funds that go to the Aragon Shield Foundation and the Eagle Association are immutably bound to the Aragon Project’s mission. The structure legally protects against anyone involved in either the Aragon Shield Foundation or the Eagle Association to “run away with funds.” In addition, the AA no longer has any sort of decision-making power over any funds, and no AA member can participate in the Eagle Association.

The AA prioritized respecting the regulatory frameworks and cooperating with authorities in its jurisdiction: Switzerland. The continuation of the project was structured to ensure that this will continue to be the case moving forward.

Lastly, this will be my last update in this Forum on behalf of the AA, and I will no longer have any role within the continuation of the project. I fully trust in the capacity and motivation of those who will keep advancing the mission in a product-focused set up.

Note: All legal and tax statements in this post have been provided by professional legal and tax experts.

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The fact remains that ANT holder’s money is being used to fund a new venture that ANT holders have no equity in, without their permission.

If this was about being equitable, ANT holders who redeem should receive equity and voting rights in the new organization as well.

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Hi Joan,

Thanks for the (late) update. Could you provide the ruling? While I believe you, I think that for transparency’s sake it would be beneficial for everyone.

There’s a slight conflict of interest here regarding the Aragon Shield Foundation. Its registered members are part of the current team and the coming Aragon Eagle Association, meaning that they will be judges and parties.

Given that there is a case already of a slight increase in funding voted to itself by the team, I’m a bit afraid about the further downfall of this classic story of insider capture. Did you consult the Eidgenössische Stiftungsaufsicht about this case?

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