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NFT-Focused OlympusDAO Fork Faces Backlash Over Unfulfilled Asset Buyback Promises

Oct 10, 2023 at 08:09 am

FloorDAO, a prominent player in the NFT finance sector, recently faced a major upheaval, sending ripples through its investor community. This turmoil arises from a palpable dissatisfaction among investors due to unmet commitments, specifically pertaining to asset repurchases. Stemming from the prestigious Olympus DAO, FloorDAO was initially envisioned to maintain a value surpassing its treasury's "book value." However, recent events have brought to light a deviation from this pledge, resulting in internal discord and ultimately a fracture within the community.

In a bid to address growing apprehensions, FloorDAO orchestrated a transfer of assets worth over $2.5 million, comprising crypto tokens and NFTs, to a dissident faction named FloorkDAO. Predominantly composed of activist investors and disgruntled holders, this faction expeditiously set in motion a redemption process, extending an offer of nearly $5 per FLOOR token—nearly approaching this year's highest valuation for the asset, presently trading at $3.88.

The schism within FloorDAO marks the climax of months-long internal disputes revolving around the project's commitment to FLOOR token investors. Records from Discord and conversations with steadfast investors reveal that initial assurances of introducing a redemption mechanism were subsequently supplanted by plans for a protocol upgrade. This upgrade not only stripped token holders of their voting privileges but also their entitlement to the treasury, further fueling discontent.

The emergence of FloorkDAO signals a broader trend of activist investors wielding greater sway within decentralized autonomous organizations (DAOs). This surge in activism is underpinned by the perspective of treating tokens as governance instruments, endowing holders with increased decision-making power. Activist investors have been progressively pushing for mechanisms that enable them to liquidate holdings when tokens are undervalued relative to their "book value."

FloorDAO's recent schism and the ascent of FloorkDAO underscore the intricacies of steering decentralized communities and underscore the criticality of upholding commitments to investors. The project's departure from its initial assurances has sparked a groundswell of activism within the community, culminating in a profound fracture. As the crypto landscape evolves, endeavors like FloorDAO serve as a poignant reminder of the pivotal roles that trust and transparency play in the prosperity and resilience of decentralized ecosystems.

Read more: Unveiling Allegations: AnubisDAO and OpenSea

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