White Hacker Group to Claim $4.4 Million in Controversial DAO Refund
More controversy surrounds the infamous Ethereum-based Decentralized Autonomous Organization (DAO) project which raised US$150 million last year. It seems victims of last summer’s DAO hack have until April 15 to withdraw DAO-to-Ethereum Classic (ETC) refunds, and there is still $4.4 million worth of tokens left at the address in question. The issue some have contention […]
More controversy surrounds the infamous Ethereum-based Decentralized Autonomous Organization (DAO) project which raised US$150 million last year. It seems victims of last summer’s DAO hack have until April 15 to withdraw DAO-to-Ethereum Classic (ETC) refunds, and there is still $4.4 million worth of tokens left at the address in question. The issue some have contention with, is that the remaining funds held in the contract will be donated to the White Hat Group (WHG).
The White Hat Group Could Receive $4.4 Million Next Week
In June of 2016, a vast majority of cryptocurrency enthusiasts watched the highest funded online crowdfund in history, the DAO Hub, fall victim to a serious exploit. An individual or team of hackers managed to drain the decentralized organization of 3.53 million ether, causing one of the most controversial forks in the cryptocurrency space and the birth of ETC. After the DAO debacle, a ‘White Hat’ draining of the stolen DAO funds took place on June 21. Members of the WHG at the time were heralded as heroes, and the Ethereum network prepared for a hard fork.
After the hard fork, a series of three DAO refunds took place for investors who still held DAO tokens. The last refund is the DAO to ETC contract that gives balance holders until April 15 to claim their reimbursement. Those involved with the refund have notified the public via blogs and social media forums, like Twitter and Reddit, with the following statement:
The DAO to ETC refund contract has an end date of April 15, 2017. There is still 1,717,513.0888 ether (USD $4,482,709.16) remaining to be withdrawn.
‘Getting a Cut of the Victims’ Money and Spending It as They See Fit’
Throughout social media forums, there have been quite a bit of people who are not pleased with the end result of the refund. After April 15, the WHG will be in control of the remaining unclaimed funds, which will net members of the group millions. Some who are skeptical are even questioning whether or not the WHG process was legal.
— The DAO (@The_DAO_Project) April 7, 2017
“The funds are actually stolen goods,” details an Ethereum community member displeased with the WHG process. “That means doing anything apart from returning them to their rightful owner is morally wrong (which is why it’s illegal, too). The funds should have been directly sent back to the owners from the start. It would have been easier and cleaner.”
The half-baked, time-limited withdraw contract has always just been the WHG’s way of getting a cut of the victims’ money and spending it as they see fit. They even put a backdoor in just in case the community wanted to extend the availability forever. They can withdraw the funds at any time, no matter what.
There are quite a few people who agree with this particular sentiment and have responded with similar statements. Some community members say the funds should remain available for withdrawal forever and have exclaimed: “the WHG has no claim on them, this is dangerous territory and I hope they will relent.”
DAO Refund is Contentious and Possibly Illegal
“In a week, so-called ‘White’ Hat Group will end up with millions of dollars in their pocket,” explains another community member. “The sad part is that no one among the actual receiver would tell about their identity. It is like a ghost. This entire story is a giant joke, but with a lot of money from the other people, I hope this is not a basic scam.”
WHG representatives have not responded to the complaints from community members on forums like Reddit and Twitter. It’s quite obvious the refund process is unsatisfactory to those objecting to the closure date. From the sound of the complaints, investors may seek legal action, like they have in the past, due to the contentious refund process.
What do you think about the WHG receiving the unclaimed DAO to ETC funds? Do you think what they are doing is illegal? Let us know in the comments below.
Images via Shutterstock, Pixabay, Twitter, and the DAO Hub.
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