Ethereum tokens tied to The DAO’s 2016 breach are being redirected toward a formal security fund intended to bolster the network’s resilience, according to Griff Green, a long-time Ethereum advocate. In a Thursday interview on Laura Shin’s Unchained podcast, Green reiterated plans to establish the security fund, signaling a shift from passive recovery to proactive risk management. The DAO hack, which occurred in June 2016, siphoned more than $50 million worth of Ether at the time and precipitated a hard fork that split the ecosystem into Ethereum and Ethereum Classic. While the claims process recovered a large portion of the funds, a substantial balance remains unclaimed, creating an opportunity to allocate capital toward audits, smart-contract safety, and governance mechanisms that could help deter future exploits.

Key takeaways

• The unclaimed DAO-era Ether is being redirected into a dedicated security fund to improve Ethereum’s security infrastructure and governance.
• Green emphasizes a DAO-style approach to distributions, including retroactive funding, quadratic funding, conviction voting, and ranked-choice voting, to guide security initiatives.
• Although more than 80% of the original funds have been claimed, the remaining balance is now valued at roughly $200 million, providing a meaningful pool for security-focused programs.
• The proposed fund aims to create a model where assets on Ethereum can be stored with an elevated level of security, potentially surpassing traditional banking safeguards in perception and practice.
• The DAO’s legacy helped ignite a broader security-audit market for smart contracts, and proponents see the new fund as a continuation of that momentum.

Tickers mentioned: $ETH

Sentiment: Bullish

Market context: The move aligns with a broader push within the Ethereum ecosystem to formalize security funding and governance experiments in a post-hack environment. As on-chain auditing and risk-management tools mature, supporters argue that dedicated pools tied to DAO-borne assets could provide a more reliable funding stream for security initiatives, which in turn may bolster user confidence and long-term network durability.

Why it matters

The DAO episode left an enduring mark on Ethereum’s security culture. The 2016 exploit not only triggered a contentious hard fork but also catalyzed an era in which smart-contract audits and formal verification gained mainstream attention. By proposing to channel unclaimed DAO funds into a security fund, Green is framing a path for capital to flow directly into security-centric initiatives, rather than being dismissed as dormant capital that cannot be returned to affected holders. If successful, the arrangement could become a blueprint for how large, legacy liabilities tied to on-chain incidents are repurposed for ongoing risk management and ecosystem improvements.

From a governance perspective, the plan signals a willingness to experiment with on-chain decision-making processes that affect risk allocation. The proposed distribution palette—retroactive funding, quadratic funding, conviction voting, and ranked-choice voting—reflects a desire to balance broad community input with targeted security outcomes. Retroactive funding could reward past work that strengthened audits and tooling; quadratic funding would aim to align contributions with the weight of community support; conviction voting and ranked-choice voting could help identify the most broadly supported security projects. Taken together, these mechanisms could make the fund more transparent and less prone to capture by narrow interests, a critical consideration in a field where trust is paramount.

Moreover, the practical dimension—turning idle assets into a revenue-generating engine for security—addresses a chronic tension in crypto: how to responsibly steward large sums of capital in a decentralized paradigm. If the fund can generate sustainable revenue through secure staking or other mechanisms, it may offer a durable competitive advantage in attracting developers, auditors, and security researchers to Ethereum’s ecosystem. The aspiration is not merely to recover funds but to create a perpetual funding loop that underwrites continual improvements in smart-contract safety, auditing standards, and proactive threat modeling.

What to watch next

• How the security fund’s governance framework will be codified and implemented, including the timelines for retroactive funding and the rollout of quadratic funding and conviction voting.
• The mechanism by which unclaimed DAO assets will be staked or otherwise deployed to generate revenue while preserving safety and compliance considerations.
• Whether community proposals or governance votes will approve initial security projects and audits, and which auditors or security researchers will be prioritized.
• Regulatory or legal clarifications surrounding the repurposing of legacy token wealth into a governance-focused security fund.

Sources & verification

• Griff Green’s interview on Unchained with Laura Shin discussing the security fund, linked through the Unchained episode referenced in the article.
• The DAO hack timeline and the June 2016 exploit, including the resulting hard fork that produced Ethereum and Ethereum Classic (SSRN paper linked in the source).
• Historical details on the claims process for DAO-token holders, including the multisignature wallet involvement around $6 million and the fact that more than 80% of funds have been claimed.
• Current estimates of unclaimed balance, cited as roughly $200 million, and the broader impact on Ethereum’s security discourse.

Security fund aims to fortify Ethereum after The DAO hack

Ethereum (CRYPTO: ETH) tokens that remained unclaimed after The DAO incident are being redirected into a new security fund designed to strengthen the network’s defenses and governance. The goal is not simply to recover value but to institutionalize a mechanism that continuously improves security across the ecosystem. Green pointed to a pool that has accumulated value over the years, with a substantial portion already claimed and a remaining balance that, according to the latest accounts, sits near $200 million. The plan envisions converting this pool into a revenue-generating engine that can underwrite ongoing security projects, audits, and research, thereby reducing the likelihood of similar incidents undermining user trust or network integrity.

The interview underscored that the fund would adhere to a DAO-style governance framework. Among the proposed distribution methods are retroactive funding—recognizing past work that has already advanced security—and quadratic funding, which seeks to equalize the influence of large and small contributors when prioritizing security initiatives. Conviction voting and ranked-choice voting were also highlighted as mechanisms to surface the projects with broad and sustained community support, rather than those propelled by short-term enthusiasm or a single influencer. In practice, these tools could help ensure that the security fund allocates resources toward the most impactful audits, code improvements, and risk-mitigation strategies, while preserving transparency and inclusivity in decision-making.

Green emphasized that the DAO’s security fund could eventually serve as a benchmark for how the industry approaches custody and risk. He asserted that the initiative aligns with The DAO’s original spirit, which was to decentralize governance and empower a broad set of participants to steward an asset class that has grown increasingly complex. The DAO’s legacy has already reshaped the security landscape by catalyzing the emergence of a robust audit culture around smart contracts; the proposed fund would institutionalize that momentum and extend it into ongoing, DAO-style governance. In his view, the project could help shift perceptions about where it is safest to store value, potentially positioning Ethereum as a more resilient option than traditional centralized financial intermediaries in the eyes of some users.

Despite the ambitious scope, several practical questions remain. How will the fund be regulated and audited? What safeguards will prevent misallocation or governance capture by factional interests? And how will the revenue model for the fund be structured to ensure long-term sustainability without introducing new risks to the network’s security posture? These are precisely the kinds of questions the community will need to answer as the proposal moves from discussion to implementation. The DAO’s security fund is not a ceremonial exercise; it represents a test case for how decentralized networks can harness historical incidents to create resilient, future-facing infrastructure that benefits developers, token holders, and end users alike.