Across Protocol Governance Scandal: Team Manipulates DAO Governance Vote, Embezzles $23 Million from Treasury

Original Article Title: "Amid Governance Scandal, Team Accused of Vote Manipulation and Embezzling $23 Million from Across?"
Original Article Author: 1912212.eth, Foresight News

On June 27, as the Celestia founder's coin sale to prepare for a protracted battle scandal temporarily subsided, another project team was exposed in a scandal. Glue founder Ogle publicly accused the cross-chain bridge protocol Across team of manipulating a DAO vote and embezzling up to $23 million. This accusation not only sparked widespread community concern but also once again brought transparency and security issues of DAO governance mechanisms to the forefront.

What exactly is the Across protocol? How did the project team manipulate the vote to embezzle funds?

Former UMA Team Ventures Anew

Across is a cross-chain bridge protocol designed to achieve seamless asset transfer between different blockchains through efficient cross-chain interoperability. Back in late 2022, it secured a $10 million investment, including from Hack VC, and in March 2025, the Across Protocol announced raising $41 million in a token sale round led by Paradigm, with participation from Bain Capital Crypto, Coinbase Ventures, Multicoin Capital, and angel investor Sina Habinian, forming a rather prestigious investor lineup.

Its founder, John Shutt, previously served as a senior engineer at UMA, while another co-founder, Hart Lambur, is also the founder of UMA and Risk Labs. Risk Labs was the development entity behind the once-famous synthetic asset protocol UMA.

Since mid-2023, its token ACX has risen from a low of $0.05 to around $1.8, a nearly 36-fold increase. However, starting from the end of last year, under the negative impact of the overall market downturn, ACX has experienced a rapid decline, currently falling to around $0.14, a decrease of over 10 times in just six months.

Across's governance model relies on a DAO, allowing users holding governance tokens to participate in proposal voting to determine the protocol's fund allocation and development direction. However, the decentralized nature of DAO governance often faces questions of "centralized control" in practice, which is precisely what Ogle has accused.

Voter Manipulation and Fund Misappropriation

Ogle elaborated on the accusations against the Across team in a lengthy article. He claimed that the Across team manipulated the DAO voting through opaque means, bypassing the community's normal governance process and transferring $23 million to an unknown account. Here are several key points of Ogle's accusations:

Voter Manipulation: Ogle pointed out that the Across team used its significant governance token holdings to dominate the DAO proposal votes. The team concentrated votes through multiple related wallets, creating an illusion of community support that actually went against the decentralized nature of the DAO. This behavior mirrors previous instances of "governance attacks" seen in projects like Compound DAO and Jupiter DAO.

Fund Misappropriation: Ogle further accused that the Across team, by manipulating approved proposals, transferred $23 million of DAO funds to an unsupervised account. He questioned the destination of these funds, stating there were no public audit records or transparent explanations of use, raising suspicions of a rug pull misappropriation.

Lack of Transparency: Ogle also criticized the Across team for a lack of open communication during the governance process. For instance, proposal details were not fully disclosed, the voting process did not provide real-time on-chain data, and community members found it difficult to verify the legitimacy of the results. He called on Across to disclose the fund flow and undergo an independent third-party audit.

Furthermore, Ogle specifically analyzed the detailed process. In October 2023, cross-chain protocol project lead Kevin Chan submitted a public proposal to the DAO, suggesting transferring 100 million ACX tokens (currently worth around $15 million) from the DAO to Risk Labs—the for-profit private company of the cross-chain protocol's founder.

On-chain analysis revealed that this proposal was actually secretly driven by Kevin and his team. While Kevin used his public address "KevinChan.Lens" to submit the funding proposal, he secretly cast a large number of "for" votes through another wallet "maxodds.eth." Several members of the Risk Labs team seemingly collectively voted in favor of this substantial allocation. Another team member, Reinis FRP, also voted "for" on the proposal using millions of ACX tokens from multiple secret wallets. The second-largest voting wallet in the entire proposal (representing nearly 14% of the total votes) was initially funded by Hart Lambur

Less than a year later, after the first vote yielded no result, the team came back asking for more funds. This time, they requested "retrospective funding" of 50 million ACX from the DAO, equivalent to about $7.5 million. Once again, Kevin's secret wallet took on most of the voting work: "maxodds.eth" and a new wallet funded by it contributed 44% of the "yes" votes.

Ogle expressed dissatisfaction when commenting on this behavior, stating, "In any other industry—whether it's a publicly traded company, nonprofit organization, government entity, or any other institution—there are strict rules prohibiting so-called 'self-dealing' and other provisions on how we should act to prevent other breaches of duty."

Some community members supported his view, finding the current state of DAO governance concerning; while others questioned Ogle's motives, suspecting that his allegations were intended to fuel Glue's competitive strategy. Glue is a security-focused public chain with lower visibility and popularity in the crypto community.

As of now, the Across team has not formally responded to the allegations.

A Stubborn Ailment in DAO Governance

Ogle's accusations are not isolated incidents but a microcosm of the longstanding issues in DAO governance. DAOs (Decentralized Autonomous Organizations), as a product of blockchain technology, aim to achieve decentralized decision-making through smart contracts and token voting.

However, the practical implementation of DAO governance often deviates from the ideal, exposing the following problems:

Centralization of Power: Despite DAOs aiming for decentralization, the unequal distribution of tokens often leads to a few "whales" controlling the voting outcomes. For instance, members of the Jupiter DAO have complained that the team manipulated governance by holding a large number of tokens, diminishing the community's voice. Similarly, the "Golden Boys" incident in Compound DAO revealed how a few token holders exploited a $24 million loophole through a proposal. Lack of Voting Transparency: Many DAOs' voting processes lack on-chain verifiable transparency, making it challenging for community members to trace the actual voting behavior of tokens. Studies show that current DAO governance protocols generally fail to ensure the long-term privacy of votes, with voting records potentially being made public after the vote concludes, increasing the risks of manipulation and coercion. Fund Security Vulnerabilities: DAO treasuries usually hold substantial funds, making them targets for hackers and internal attackers. The 2016 The DAO hack is a classic example, where an attacker exploited a smart contract flaw to steal $50 million worth of Ether, leading to a hard fork in the Ethereum community. In recent years, incidents like the Beanstalk DAO flash loan attack have shown that governance vulnerabilities can result in the instant depletion of treasury funds. Legal and Liability Ambiguity: The decentralized nature of DAOs blurs their legal status, and members may face unforeseen legal liabilities. For example, in the 2023 case of Sarcuni v. bZx DAO, a U.S. court ruled that DAO members could be considered general partners and held jointly liable for protocol losses. This ruling raises concerns about the legitimacy and compliance of DAOs.

Due to the current intractable problem of DAOs, Ogle pessimistically believes that "almost all DAOs in the cryptocurrency field are complete scams, or at least a facade. I believe that cryptocurrency investors face a much greater threat from insiders than from outsiders (such as hackers)."

Summary

Facing the dilemma of DAO governance, the industry needs to seek improvement from three levels: technology, mechanisms, and culture. At the technological level, more secure smart contracts and voting protocols can be developed. For example, adopting Zero-Knowledge Proof (ZKP) technology can protect voting privacy while maintaining on-chain verifiability; multi-signature and timelock mechanisms can reduce the risk of treasury funds being stolen. At the mechanism level, optimizing token distribution and voting weight design can avoid "whale" dominance. For example, introducing Quadratic Voting or a reputation system can give more voice to active community members. Additionally, mandatory independent audits of proposals and fund allocations can increase transparency.

Ogle's accusation against Across serves as a wake-up call for the blockchain governance ecosystem. DAOs, as an ideal vehicle for decentralization, carry the community's expectations of fairness and transparency, but their development still faces many challenges. The industry should take this event as an opportunity to accelerate the iteration and improvement of governance mechanisms.