Let us recall that the Decentralized Autonomous Organization or DAO is an autonomous organization, the regulations of which are dictated by the rules of the blockchain code and practically does not depend on the human factor. All financial transactions of DAO participants are recorded on the blockchain and regulated by smart contracts.
In less than a week, a decentralized autonomous organization (DAO) called ConstitutionDAO raised over $ 45 million in Ethereum to purchase the original first seal of the US Constitution. It was put up for sale at Sotheby’s tonight. Initially, the DAO participants hoped to raise at least up to $ 20 million, since this is the estimated cost of the document after the assessment by the experts of the auction house, but they were able to get more funds. Although in the end they never got the lot. Let’s talk about the situation in more detail.
Accordingly, the risks here are associated only with possible errors and vulnerabilities in the code.
Who bought the US Constitution
ConstitutionDAO was created just a few days ago, but in such a short time the organization managed to attract more than 17 thousand participants. Each of them donated an average of $ 2,000 to the needs of the initiative. The largest donations were $ 1 million from investment firm Metaversal and another $ 4 million from an anonymous crypto enthusiast, Decrypt reports.
As a result, unknown users of cryptocurrencies – and there were 17,437 people – raised more than $ 45 million.
The main mission of the ConstitutionDAO is to win an auction for a copy of the US Constitution and ensure its public safekeeping. One of the DAO members, Nicole Ruiz, explained that they do not yet have an agreed place to store the document, but the organization’s members want to place it in some kind of museum with free admission. Some members of the organization spoke out in support of the idea of transporting a copy to several locations around the world at once, so that as many people as possible could see it with their own eyes.
Funding for ConstitutionDAO was raised through the JuiceBox crowdfunding platform. The campaign kicked off on November 14th. According to DAO member Pakie McCormick, the project raised over $ 3 million in its first 12 hours of fundraising. Thus, the organizers of the idea managed to collect almost twice as much money than they had originally expected. According to them, the money will become “insurance” in case of a protracted auction.
Most interestingly, those who donated their funds to the ConstitutionDAO will receive their “free” money back after purchasing a copy of the Constitution. They will be distributed among the participants using smart contracts and JuiceBox tools.
Alas, the participants of the decentralized organization did not succeed in achieving their goal. Although they raised over $ 45 million in ETH, the final bid per lot was $ 41 million – and it was made by another person. Why the representatives of the organization did not make a bet is unknown.
According to journalists, all members of the organization will receive a refund in the form of governance tokens within the DAO. Accordingly, these coins will allow them to vote on decisions and influence the further development of the project.
To meet the requirements of the Sotheby’s auction, representatives of the organization had to create a common account on the FTX exchange. There were 13 of them in total – that is how many multi-signature holders the project has.
Recall that a multisignature is a set of cryptographic signatures required to conduct a transaction from an account. A normal user signs a transaction with his private key only once, but in the case of multisignature, the transaction requires the signatures of all or most of the key holders. This increases the security of assets and makes it impossible to attack a single key holder.
This news shows how useful blockchain can be in large scale human cooperation. ConstitutionDAO rules are formed and immortalized in the code, that is, the organization is not subject to the negative influence of the human factor. In addition, she managed to collect a huge amount in the shortest possible time precisely due to the fact that investors trust the blockchain more than centralized bodies.
And while the investors failed to fulfill their original goal, they made history anyway. Most likely, in the future such organizations will become more and more. Well, the idea of acquiring some significant document or object for the common good will clearly find its fans.