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One Month After Ethereum Fork, Millions in DAO Funds Unclaimed

One Month After Ethereum Fork, Millions in DAO Funds Unclaimed

One Month After Ethereum Fork, Millions in DAO Funds Unclaimed

It's been a month since the ethereum hard fork moved $150m worth of DAO ether into a withdraw-only account. Today, $25m is still unclaimed.

It's been a month since the ethereum hard fork moved $150m worth of DAO ether into a withdraw-only account. Today, $25m is still unclaimed.

It's been a month since the ethereum hard fork moved $150m worth of DAO ether into a withdraw-only account. Today, $25m is still unclaimed.

AccessTimeIconAug 22, 2016, 6:41 PM
Updated Aug 18, 2021, 5:09 PM

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It's now been one month since a hard fork of the ethereum blockchain resulted in 11.6m ether being moved to an account with one function: withdraw.

At the time, that was about $145m worth of the digital currency just waiting for former investors, and within hours of its creation, nearly half of those funds had been claimed.

Today, however, the rate of withdrawal has come to a near standstill.

Over the last week, the withdrawal account's balance has dropped from 2.39m ETH to just 2.29m ETH today. At today's rate, that leaves more than $25.9m worth of ether still unclaimed.

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Who owns this unclaimed ether? And why do they seem perfectly content leaving it untouched?

While this may never be fully known due to the pseudonymity offered by the ethereum blockchain, multiple data analysts have begun to search for, and collect, answers.

According to one set of recently published data, 31% of all addresses capable of withdrawing ether have done so.

Matthew Tan, founder of ethereum block explorer Etherscan, has been tracking the account totals since The DAO first launched in May, and he believes the remaining total in the new DAO contract isn't likely to change.

Tan told CoinDesk:

"Those who knew how to do it or wanted to withdraw [have] already done so."

Breaking down the numbers

Currently, all the accounts formally associated with The DAO are empty, according to Tan’s Etherscan account. This includes other accounts connected to the DAO's demise, including the Dark DAO balance that was removed by a hacker and the White Hat balance that was created by a vigilante effort.

The new contract comprising the total meant to be returned to customers, however, has not yet hit zero.

Within hours of the creation of The DAO withdrawal account, 41% of the funds had been withdrawn, and just two days later that number had increased to 60% withdrawn. Today, 80% of the original ether has been claimed, but the rate of withdrawal has slowed to ~0.4% a day.

Now, researchers are seeking to find out more about the account in a quest for an answer as to why funds remain.

For example, data analyst Thomas Rush has been using his EthSlurp tool since The DAO launched in May to extract transactions associated with The DAO and help others research the data. Rush even wrote a script to analyze The DAO withdrawal data.

According to Rush’s findings (current as of last Tuesday), 13,701 accounts still contained value, but most was concentrated in the top 25% of account holders. By his calculations, three addresses account for 27.09% of all the value.

He emphasizes the numbers are approximations.

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Data analyst Bokky Poobah of New Zealand-based Bok Consulting also crunched similar numbers and came to a comparable conclusions, though he divided his findings differently. According to Poobah's calculations, there are about 22,000 accounts that have yet to withdraw.

As of 18th August, Poobah said that 8,632 accounts have a balance of less than 1 ETH compared to five accounts that hold $10.1m at today's rate.

"I feel that these numbers are 'close' but probably not 100% accurate," Thomas told CoinDesk, adding:

"At the very least, they may give you a sense of what’s going on."

Ignorance, crime and fear

In conversations with analysts, three theories emerged to explain why all this money remains even as the rate of withdrawal has all but stopped: ignorance, crime, and fear.

Tan argued that the withdrawal process itself may be the ultimate barrier preventing many people entitled to funds from withdrawing them.

Based on inquiries received by Etherscan, Tan said that many people are still uncertain which of the multiple possible processes they need to follow and how to interact with what he describes as a "multi-stage contract".

But according to cybercrime investigator and founder of the Defense Computer Forensics Laboratory at the Defense Cyber Crime Center, Ken Zatyko, illegal behavior may also account for some of the unclaimed money.

Zatyko is a senior manager at Deloitte and founder of blockchain security firm Buffalo Blockchain. Zatyko said that the publicity caused by the DAO hacker may have made some token-owners concerned that an investigation similar to that which resulted in the arrest of Silk Road founder Ross Ulbricht might currently be underway.

Zatyko told CoinDesk:

"If account holders used ether-related gambling sites, or were concerned about capital gains from crowd source related ether coins, they may want to await any further actions to ensure they are not being investigated by the Feds in related cases."

According to Rush, fear may prove the ultimate obstacle to withdrawal.

Specifically, he mentioned unintended consequences such as the replay attacks common last month, an incident which found transactions being logged on both blockchains as an example of possible negative results for which users were unprepared.

Regardless of why the withdrawal rate continues to slow, one thing is certain. Without a back door to that account, either that money will stay there forever, or more extreme measures to recoup the funds will need to be discussed.

Buried money image via Shutterstock

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