In the midst of the ongoing debate surrounding the cryptocurrency platform Bankless and its associated decentralized autonomous organization (DAO), BanklessDAO, the creators of Bankless are proposing a separation of the brand from the DAO.
Founders David Hoffman and Ryan Sean Adams intend to present a governance proposal to BanklessDAO to formally detach the two entities. Making the announcement on X (formerly Twitter) on Nov. 26, they also revealed their plan to burn all BanklessDAO (BANK) tokens in conjunction with this proposal.
The decision to sever ties between Bankless and BanklessDAO stems from community backlash over BanklessDAO’s application for a grant from Arbitrum. Submitted on Nov. 20, the application sought 1.82 million Arbitrum (ARB) tokens from Arbitrum, a layer 2 scaling project for the Ethereum blockchain. At the current valuation, this amounts to approximately $1.8 million, as per CoinGecko data.
Concerns arose within the community that BanklessDAO might be making such substantial proposals by leveraging the reputation of the Bankless brand, which they did not create and should not be profiting from, according to Hoffman’s statement.
The BanklessDAO community swiftly criticized the initiative, highlighting the lack of detailed information in the proposal regarding how the funds would be utilized for content creation. In response, BanklessDAO pledged to revise the proposal, reducing the grant period from one year to three months and providing clear key performance indicators (KPIs) and milestones.
The dispute between those supporting and opposing the proposal escalated quickly on social media. Commentators such as pseudonymous Delegate Cash CEO Foobar accused Bankless founders of engaging in “legitimacy grifting,” suggesting that they were falsely portraying BanklessDAO as entirely separate from Bankless.
Bitcoin enthusiasts, including Pledditor, also took issue with Bankless founders, accusing them of disingenuously claiming not to be “grifters” while promoting projects like Nexo. Adams responded to the criticism, emphasizing that labeling creators as grifters for running ads is akin to attempting to consume products for free. He also noted that the mission of Bankless has always been funded by paid subscribers.
Established in 2019, Bankless is a cryptocurrency media company dedicated to advancing the adoption and awareness of bankless financial systems. In May 2021, the company introduced Bankless DAO, a decentralized community focused on coordinating and promoting bankless media, and launched the BANK token.
In April 2023, the founders of Bankless announced the initiation of a $35 million venture capital fund to invest in early-stage Web3 companies.