Empire Newsletter: WikiLeaks founder is finally home after DAO support

Plus, FTX creditors can soon vote on the distribution plan proposed by debtors, and it isn’t a fan favorite


Cypherpunks win

AssangeDAO may be the most successful example of a single-use decentralized autonomous organization to date, even with all of its shortcomings.

Drawing a direct line between its fundraising efforts and the release of WikiLeaks founder Julian Assange isn’t totally practical. But the DAO did do something very tangible: It raised $56 million in ETH for Assange’s camp.

It was a huge sum. Taking a page out of FreeRossDAO, another org launched in support of imprisoned Silk Road founder Ross Ulbricht, AssangeDAO used the crowdfunded ETH to buy an NFT it minted in collaboration with digital artist Pak.

The NFT is tied to an image of a clock counting the days Assange was being held awaiting potential extradition. It is still the second-most valuable NFT ever bought, behind only Beeple’s $69.3 million Everydays: the First 5000 Days token.

AssangeDAO forwarded the proceeds (minus a 5% fee to fundraising platform Juicebox) to the Wau Holland Stiftung, a nonprofit launched in 2003 as an homage to the co-founder of the hacker collective Chaos Computer Club. The stiftung began facilitating donations to WikiLeaks after boycotts from Mastercard, Visa and PayPal in 2012 — a blockade that led WikiLeaks to open up for bitcoin donations, an event considered a hallmark moment in crypto history.

AssangeDAO contributors were rewarded with a governance token, JUSTICE, which could be used to vote on which direction to take the DAO (one proposal to branch out from its core mission was overwhelmingly shot down).  

But the group was reportedly plagued with disagreements. A leaderless structure led to a sense of directionlessness and the DAO quickly split up following the departure of some core members.

AssangeDAO donated 16,592 ETH, and about 75% of those funds have been moved out of the Wau Holland wallet, with $15 million left to go at current prices

To this date, the wallet that received AssangeDAO’s donation continues to make withdrawals. (The value of the ETH withdrawn is shown in light purple on the chart above, dark purple shows the current treasury balance, and the pink line shows the performance of the DAO’s token).

The initial raise happened in February 2022, and after two rounds of outflows of around $2 million each in the following three months, the address initiated a steady stream of 150 ETH ($507,000) withdrawals almost every week, which ran until markets picked up again last October.

Outflows have slowed since then. Still, $7 million in ETH has flowed out of the Wau Holland address over the last seven months or so, during which time the British High Court ruled that Assange could appeal his US extradition, leading to his plea deal and release this week.

At least some of those funds have ended up on Kraken and Coinbase — as is to be expected despite some claims — but it’s unclear exactly what the Wau Holland fund has done with the crypto. 

Stella Assange, Julian’s wife, posted an “emergency appeal” on X overnight in hopes of raising $520,000 to cover chartered flights to Saipan and later Australia, to which crypto lawyer and AssangeDAO founding member Silke Noa suggested that the Wau Holland foundation could front the bill, considering that’s why the funds were initially raised.

For what it’s worth, it’s still assumed that Wau Holland has directed its outflows on legal and other costs associated with securing freedom for Assange. A press release stated the foundation had spent 16 million euros ($17 million) in support of Assange and that it would guarantee his flight to Australia.

It hasn’t been explicitly confirmed that those funds refer to the ETH raised by the NFT sale, and they could include separate crypto donations made to WikiLeaks over the years. 

In light of JUSTICE tripling in price over the past few weeks, one wonders the current status of the DAO and whether it might make a comeback. 

Early DAO supporter Harry Halpin told Blockworks that “the Assange family, particularly his brother Gabriel Shipton, has been active in AssangeDAO but obviously Julian, Stella, Gabriel and the rest of the family deserve some time to rest.”

Halpin added: “After a suitable time for rest and recovery with his wife and children — that Julian has been so cruelly taken from by the USA for so many years — I hope Julian will join the DAO himself. I do not track any price actions, as I think the price of justice for Julian Assange is beyond value.”

In any case, with the benefit of the doubt, AssangeDAO was clearly triumphant in its mission, at least, far more than ConstitutionDAO was in buying a rare copy of the US constitution. 

Now let’s see if the same can happen for Ross Ulbricht.

— David Canellis

Data Center

  • FreeRossDAOs treasury was worth over $8.8 million shortly after its launch in November 2021. It now holds $23,500, with NFT sale proceeds partly helping to facilitate meetings between prisoners and their families.
  • ConstitutionDAO raised $47 million before disbursements after it lost the auction. A recent rally in PEOPLE has pushed its treasury back up to $3.6 million.
  • BTC and ETH are trading sideways today, still above $61,000 and $3,300.
  • ENS is floating among NOT, PEPE, ORDI and WIF, all up between 4% and 8% over the past day.
  • Optimism has gained the most of chains with $1 million or more stablecoins, adding 7.5% to reach nearly $1.2 billion in the past week.

Cast your vote!

Tell ‘em how you feel.

FTX creditors can soon vote on the distribution plan proposed by debtors, after the latter received the green light Tuesday in a bankruptcy hearing.

It’s pretty fair to say the plan isn’t a total fan favorite, though lawyers have told Blockworks that it’s a “good outcome.”

Creditors previously said the plan, which would pay folks back in cash versus in-kind (meaning the crypto they had on the exchange at the time of the bankruptcy), inherently means losing out on potential gains because of how much crypto has rallied since the collapse. 

Meanwhile, FTX lawyers at the hearing noted that large stakeholders haven’t objected to the plan. 

Creditors, however, have countered, saying the plan doesn’t make the outcome clear. Proponents have suggested that folks will be made whole… though that’s not wholly true in this case, but we’ll get to that shortly.

Reuters reported that CEO John J. Ray said the crypto simply isn’t there to return, echoing what we reported back when the plan was proposed. 

“The fund they amassed to repay creditors is really based more on liquidation of securities holdings…and other recoveries from third-party claims and selling off other assets,” Jonathan Groth, partner at DGIM Law, told me in May.

Blockworks co-founder and Empire host Jason Yanowitz made a very fair and astute point last month: the apparent marketing strategy around the plan proposal lured mainstream media in with flashy numbers, which they then touted as a win. Though — aside from putting FTX to rest once and for all — that’s not the case.

“Sullivan & Cromwell, which has already made some $180 million from the bankruptcy, is smart — they’ve pursued a tactful PR strategy to get ahead of the negative creditor narrative,” he wrote. “The goal: convince the mainstream media that paying customers back at 118% represents a success.”

In all fairness, it does look like a win…until you compare the actual crypto prices. The 118% return that many customers are set to receive is based on the price of crypto in November 2022, not the price of crypto now, as bitcoin hovers around $61,000.

It’s also pretty different from other crypto bankruptcies, with some returning smaller amounts of crypto back to customers.

Anyway, creditors won’t receive the funds at today’s crypto prices — Judge John Dorsey shot down that idea (proposed by creditors at the beginning of this year) a few months ago, arguing that it’s against bankruptcy code.

Next steps are for the ballots to be formalized by mid-August, which would mean that the estate seeks final approval of the plan in early October. 

So the floor is about to open for folks to give their two cents. After speaking to lawyers and hearing from other creditors, I’m curious to see what the larger base has to say about this — and if the big numbers were enough to sway some people. 

Perhaps people are ready to put this whole saga behind them at whatever cost. It’s clear that the wider crypto environment is, at least.

— Katherine Ross

The Works

  • Securitize and Investcorp said they’re teaming up to “explore fund tokenization opportunities.”
  • Arkham reported that the German government has moved 400 bitcoin this week as it looks to offload roughly $24 million.
  • Ava Protocol, an actively validated service on EigenLayer, acquired blockchain data startup Openstory, The Block reported. 
  • Ripple CEO Brad Garlinghouse warned that SEC Chair Gary Gensler will “cause Biden to lose the election.”
  • GSR announced a co-CEO structure, appointing Rich Rosenblum and Xin Song to the roles. 

The Riff

Q: What is crypto missing?

Remember yesterday when we said that retail isn’t here right now?

Yeah, we need them back.

I’m not talking about the family members who were convinced to buy in at the height of FTX, only to watch everything collapse two years ago. I’m talking about the folks who started hearing about crypto and wanted to test the waters. 

And I’m also talking about the retail investors who were just building out a portfolio made up of both crypto and equities. I miss those guys. 

Maybe with enough time and enough demand, they’ll be back, but their absence is evident this cycle. Bring on their return.

— Katherine Ross

Wordle, but make it NFTs.

Just kidding.

On one hand, there are a ton of incremental and not-so-incremental technical updates that could greatly benefit certain parts of the ecosystem: DeFi can do with better atomic swaps and Solana could too with a new validator client in Firedancer.

But those will just bring crypto more of the same. 

So, here’s a jaded answer: Crypto doesn’t need anything. In fact, it needs less things. 

Let’s just go back to when Kickstarter-style fundraises and buying dumb stuff on the internet were the killer apps and call it a day.

— David Canellis

Updated Jun. 30, 2024 at 10:08 am ET: Changed reference to Halpin’s role in AssangeDAO.

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