Cryptocurrencies

Brother of WikiLeaks founder Julian Assange responds to blockchain security firms SlowMist and RescuETH

Brother of WikiLeaks founder Julian Assange In response to blockchain security firms SlowMist and RescuETH on June 17, they told Cointelegraph that the companies’ April report that AssangeDAO could be “misleading” was “simply false.” Both security firms reported that the DAO had shown “suspicious” transactions and that community members were concerned that it was a “soft carpet” or phasing out scam.

“The SlowMist article is completely false – they initially confused AssangeDAO with the Wau Holland Foundation,” said Gabriel Shipton, Assange’s brother, via Telegram. According to Shipton, AssangeDAO no longer owns the 16,593 Ethereum (ETH) (approximately $53 million) it raised in 2022, all of which was spent on a non-fungible “Clock” token (NFT) produced by the artist Pak as a digital currency. Part of the “Monitoring” group.

Buck donated the proceeds from the sale to the German charity Wau Holland Foundation, and the funds are no longer under the control of AssangeDAO. “All proceeds from the sale were donated to the F. Holland Foundation’s Moral Courage: Julian Assange project – with the aim of supporting and defending Julian Assange’s freedom,” Shipton said.

Additionally, Shipton claimed that the German charity uses the funds for their intended purposes and complies with all local laws:

“ETH has worked with the Wau Holland Foundation, which it relies on to pay many of Julian’s legal fees and campaign expenses. (…) The F. Holland Foundation is subject to German charity law and has a long-standing relationship supporting Julian and WikiLeaks.

Assange is currently imprisoned in a London prison after the United States accused him of espionage for his alleged role in publishing secret documents on the WikiLeaks website. He is fighting extradition and his hearing is scheduled for July 9. Supporters, including AssangeDAO organizers, say his actions protect free speech and do not constitute crimes.

Blockchain data confirms that AssangeDAO purchased the Clock NFT on February 9, 2022 for 16,593 ETH. Proceeds from the sale were sent to the address Censored: Publisher Clock starting with 0x5DA and is no longer maintained by AssangeDAO multisig.

Cointelegraph contacted SlowMist for comment but did not receive a response at the time of publication. SlowMist is a blockchain security company that offers anti-money laundering (AML) compliance software and wallet security. It is known for helping exchanges and protocols track stolen and laundered funds.

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The genesis of AssangeDAO

AssangeDAO was created in early 2022 to pool investors’ funds to purchase the Clock NFT. It draws inspiration from the previous Constitution DAO, which attempted to raise funds to purchase an original copy of the United States Constitution.

AssangeDAO has raised over $53 million as of February 2022, making it the most funded DAO in history.

When AssangeDAO was established, cooperation between Assange and Pak was also announced. The artist plans to release a collection of NFTs called “Censored.” One NFT, “Clock,” displayed a counter indicating the number of days Assange had spent in prison for his work with WikiLeaks.

Buck’s “Clock”. Source: Censored.art

According to the project’s website, the goal of selling the censored range of NFTs was to raise funds for Assange’s legal defense.

AssangeDAO would be a separate entity from the regulated project, having been created to purchase the artwork rather than create it. The DAO issued a token called JUSTICE, which it sold for ETH. According to statements from the DAO at the time, funds raised from this effort will be used to bid on the NFT. The DAO hoped to win the auction and obtain the clock. But if he fails, he hopes to at least raise the minimum price for a piece of digital art, allowing Assange’s family to raise more money than they otherwise would have.

SlowMist report highlights “suspicious” transactions.

On April 2, SlowMist and RescueETH released a report warning investors against interacting with AssangeDAO. “The true intentions behind AssangeDAO remain unknown, and we await an official explanation or further disclosure of information from the organization itself,” the report said.

At the same time, “investors should also be aware of the risks involved and conduct thorough research and evaluation before investing in any project, particularly those involving decentralized autonomous organizations.”

The two companies claimed that a suspicious transfer of 100 Ethereum (worth approximately $388,000 at the time) took place on March 10, 2024. This transfer came from “Censored: Clock Multisig”, whose The address starts with 0x5DA. The report states that this address “is linked to the decentralized autonomous organization AssangeDAO, prompting some community members to express concerns that the rug could be pulled out from under them.”

The report also claims that this address is “the multi-signature address of the German Wau Holland Foundation” and that blockchain data “shows that funds from this address come from funds collected by AssangeDAO.”

Using its MistTrack AML platform, SlowMist would have tracked all transfers from this address. It found that on April 8, 2022, this account sent 580,745 ETH to a smart contract address which then sent it to several other wallet accounts. He sent an additional 34.99 ETH to other addresses on May 9, 2022, and 124 ETH (around $250,000 at the time) to a Coinbase deposit address on May 11, 2022.

After sending the money to these different addresses, she consolidated them into just two accounts, one starting with 0x323 and the other starting with 0x2f9. The 0x323 address was created in October 2020 and frequently sent ETH to centralized exchanges.

Monitored: Publisher transactions 24 hours a day. Source: Slow Mist, RescueWith

The report concluded:

“In the case of AssangeDAO, although its initial goals were noble, recent large financial transfers have raised many questions, particularly as to the final destination of the funds. »

Data from the AssangeDAO blockchain

Blockchain data shows that the censored publisher address: Clock starting with 0x5DA is not the same account as the AssangeDAO multisig wallet. The Ethereum username AssangeDAO.eth is transferred to an address ending in eA00, which is a completely different account than the one that made the alleged suspicious transfers.

Additionally, it appears that this account purchased the Clock NFT, spending approximately $51 million in the process. Several hours after the purchase, Buck delivered the digital artifact to AssangeDAO, and it remains in AssangeDAO’s possession today. Proceeds from the sale went to the Censored: Clock project team account and are no longer in the AssangeDAO multisig wallet.

NFT transfers to and from AssangeDAO. Source: Atharscan

Blockchain data cannot prove that two institutions are completely separate; they can only show that transactions were executed by two separate wallet addresses.

Shipton claimed that the Censored: Clock Publisher account is controlled by the Wau Holland Foundation, not AssangeDAO.

Cointelegraph contacted the F. Holland Foundation for comment but had not received a response at the time of publication. According to its website, the foundation is a non-profit organization whose goal is to promote the ideas of computer security activist F. Holland. He also helps raise money for Assange, as well as other whistleblowers such as Chelsea Manning, Jeremy Hammond and Edward Snowden.

F. Holland Foundation website. Source: F. Holland Foundation

Some DAO members remain dissatisfied

Despite Shipton’s assurances, some AssangeDAO members remain dissatisfied with the team’s behavior.

Cointelegraph spoke with a JUSTICE token holder who claimed that the DAO does not have a proper token-based voting system. “The entire $55 million was mined from the DAO without the consent of the cryptocurrency community,” said the token holder, who spoke on condition of anonymity. They claimed this violated “the principles of a decentralized and autonomous organization, where community consensus is crucial”.

According to a DAO member, some participants wanted to keep some of the funds to use for other charitable projects, but were rejected by the signatories of the DAO’s multi-signature wallet, who signed a transaction to spend all the funds on the NFT. In defense of their decision, the DAO’s multiple signatories reportedly said there was no legal liability for the formal vote, as the purpose of the DAO was clearly stated on the regulator’s website.

DAOs were invented with the aim of allowing investors to coordinate their actions over the Internet, even if they are located at great distances from each other and in different jurisdictions. However, it has also at times been the scene of deep disagreements among DAO members.

In January, HectorDAO members accused the development team of being involved in an “internal function” hack after losing $2.7 million under suspicious circumstances. The DAO was then taken over by a bankrupt company by court order. In April, some MangoDAO insiders were accused of conducting the equivalent of a raid on an online company.

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