Branching as Legacy: Ethereum Security Fund at $220 Million to Revive TheDAO Funds

Ten years ago, Ethereum was on the brink of collapse. When TheDAO, a community-managed venture fund, raised over $150 million in Ether, it became one of the largest initiatives in the digital asset world. However, a hacker attack drained most of the project’s funds. This critical test raised an inevitable question for the community: should they fork the blockchain, rolling back the clock, or adhere to the principle of immutability? The choice to fork became not just a technical necessity but a philosophical statement about the value of protecting users. Now, near 2026, this decision is bearing unexpected fruit.

This week, cyber security leaders announced the use of 75,000 Ether — funds that remain unaccounted for after a major criminal investigation. At current prices, these assets are worth approximately $160 million, though during initial discussions, their value was estimated at $220 million. The DAO security fund, a revived organization, will allocate these funds to strengthen smart contract security and the overall Ethereum infrastructure.

When Forking Was Inevitable: 2016 as a Turning Point

In June 2016, when Ethereum was still a young blockchain, TheDAO launched an ambitious crowdfunding campaign. Beyond ordinary funding, the project symbolized decentralized governance and collective decision-making. It quickly attracted significant investments. But a hacker discovered a vulnerability in the code, gaining access to the fund’s treasury.

The Ethereum community faced a challenging dilemma: the digital asset was supposed to be immutable, yet now this principle could cause the misery of millions. Forking — a technical and philosophical response — was proposed as a solution. The decision was supported by those who believed that forking would uphold the philosophy of immutability, and by those who understood the need for an exception. The majority chose to fork, returning the stolen assets to their owners.

However, some funds remained in a special crypto wallet — so-called “edge cases” that were difficult to recover by the original owners. At that time, there was a promise that unused funds would be directed toward a purpose that was destined to wait ten years.

The Forgotten Promise Awakens After Two Decades

The story could have ended as a forgotten obligation amid digital ruins. But Fade, a market researcher from the Wintermute team, found an old blog post from 2016 while reviewing archived contracts. His discovery sparked a new discussion. “I proposed using these funds,” he wrote on social media platform X.

The proposal hit the mark. Grim Green, one of the architects of the original forking decision and a security researcher, confirmed: this moment is an opportunity long awaited. Now, as Ethereum has evolved from an experimental project into one of the most important foundations of decentralized finance, protecting its codebase has become a critical need.

Moving Forward: How Ethereum Will Be Safer

The DAO security fund will not simply spend 75,000 Ether. Instead of draining the treasury, the fund will use these assets as collateral — as a safety cushion, with profits reinvested into ongoing smart contract security.

Leading figures from the Ethereum ecosystem will manage the fund. Vitalik Buterin, co-founder of Ethereum, historian Taylor Monahan from MetaMask, and four other experts will form the governing board. However, management will not be centralized — Ethereum users will have voting rights on fund allocation, ensuring decisions are community-driven.

The fund will focus on six priorities outlined by the “Security for a Trillion Dollars” initiative at the Ethereum Foundation. These include vulnerability research, development of protective tools, and developer education.

Grim Green succinctly described this moment: “The DAO security fund marks the beginning of a new phase for Ethereum security. The world is ready for our technology, and we want to ensure that our technology is prepared for the world.”

The decision to fork ten years ago was not just about saving individual users but about preserving the very idea of a fair blockchain. Now, this choice is transforming into assets that will safeguard Ethereum’s future.