Compound DAO converted 8.42 million DAI into 344,780 COMP and a delegate calls it a mandate breach
Delegate ugurmersin says 8.42 million DAI in Compound's deprecated v2 reserve bought 344,780 COMP and was used to vote on two proposals; the Foundation says the mandate allowed it.
Why it matters
The open question is how far a Foundation's authority over DAO reserves extends when those reserves are converted into tokens and used to vote, and no public resolution has been reported. Protos notes that Proposal 536, which handed over the DAI, set up no explicit treasury management programme, so the mandate language itself is what the two sides read differently.
Where the sources disagree
The size of the outlay behind the COMP purchase
Supporters held 50.1% of delegated power, or 45.1% without the reserve tokens
CryptoSlate
Both proposals had enough votes to pass without the Foundation's additional COMP
Protos
CryptoSlate values the purchase at $52 million of COMP, while Protos states the funds committed were 8.42 million DAI, and neither outlet reconciles the two figures.
Key facts
Bitquery data reported by CryptoSlate places 344,780 COMP arriving in a Compound DAO reserve wallet at 09:46 UTC on May 5, 58 minutes before the Proposal 582 voting snapshot.
344,780 COMPReported by CryptoSlate
The wallet holding the 344,780 COMP had its votes delegated to the Compound Foundation, which backed the proposal.
344,780 COMPReported by CryptoSlate
Protos reports that delegate ugurmersin said 8.42 million DAI from Compound's deprecated v2 reserve was used to buy the 344,780 COMP.
8,420,000 DAIReported by Protos
Ugurmersin alleged on Sept. 27 that the conversion and the delegation breached the reserve mandate, calling the use of the funds a misappropriation.
Disputed figureReported by CryptoSlate
The Foundation said on Sept. 28 that the conversion was consistent with the mandate's governance-continuity purpose, that the COMP remains DAO-owned and that none of the assets were spent on Foundation operations.
Disputed figureReported by CryptoSlate
CryptoSlate says supporters held 50.1% of delegated voting power at the May snapshot and would have held 45.1% without the reserve tokens.
50.1 %Disputed figureReported by CryptoSlate
Proposal 582 passed with zero votes against, on 1,883,966 votes counted by Bitquery.
1,883,966Reported by CryptoSlate
What happened
CryptoSlate, citing Bitquery, reports that 344,780 COMP reached a Compound DAO reserve wallet at 09:46 UTC on May 5, 58 minutes before Proposal 582's voting snapshot, in a purchase it values at $52 million of COMP. Protos reports that forum delegate ugurmersin said 8.42 million DAI left over from the deprecated v2 reserve paid for those tokens, which were delegated to the Foundation's voting address and used on Proposals 580 and 582, one of which transfers $14 million to the Foundation for a year of v4 development. CryptoSlate says supporters held 50.1% of delegated power at the snapshot against 45.1% without the reserve tokens, and that Proposal 582 passed with no votes against on 1,883,966 votes counted for it. Protos says both proposals had enough votes to pass without the Foundation's extra COMP, so the two outlets disagree on whether the acquired tokens mattered to the outcome. The Foundation said on Sept. 28 that the conversion was consistent with the mandate's governance-continuity purpose, that the COMP remains DAO-owned and that no reserve assets paid Foundation operations, and Protos describes the same response as consistent with the conditions attached to the funds. CryptoSlate also notes that the route from reserves spent to COMP received runs through a Binance account, and that public chain data alone cannot prove which account funded the withdrawal.
How the story developed
- Update
Delegate ugurmersin alleges the conversion breached the reserve mandate
The Sept. 27 governance forum post calls the conversion of the DAI into delegated COMP a misappropriation of DAO funds.
- Official statement
Compound Foundation says the conversion matched the mandate
The Sept. 28 response says the conversion served the mandate's governance-continuity purpose, the COMP stayed DAO-owned and no reserve assets paid Foundation operations.
- First report
First report by CryptoSlate
Compound DAO used protocol reserves to buy $52 million worth of COMP, and delegates call it a mandate breach
- Update
344,780 COMP reaches a DAO reserve wallet 58 minutes before the Proposal 582 snapshot
Bitquery puts the transfer at 09:46 UTC on May 5, and the wallet's votes were delegated to the Compound Foundation.
- Update
Proposal 582 passes with zero votes against
Bitquery counted 1,883,966 votes for the plan.
- Independent corroboration
Independently corroborated by Protos
Compound Foundation accused of ‘misappropriating’ DAO funds
- Update
Proposal 536 hands the v2 reserve DAI to the Foundation
Passed in February, it allows the DAI to be used 'in a manner prudent for addressing important protocol needs' and does not establish an explicit treasury management programme.
- Update
Protos adds the DAI amount, the second proposal and the Proposal 536 wording
The report names the outlay as 8.42 million DAI, covers Proposals 580 and 582, and quotes the February authorisation that granted the Foundation the funds.
How coverage built up
Independent sources over time, counted the way the consensus panel counts them: a republication of a wire story does not move the line.
- 29 Sept 2026, 02:30 UTC: CryptoSlate — 1 independent source, 1 reports
- 29 Sept 2026, 11:21 UTC: Protos — 2 independent sources, 2 reports
Affected entities
Original sources
| Publisher | Report | Role | Published |
|---|---|---|---|
| CryptoSlate Crypto media | Compound DAO used protocol reserves to buy $52 million worth of COMP, and delegates call it a mandate breach | Original | |
| Protos Crypto media | Compound Foundation accused of ‘misappropriating’ DAO funds | Independent |
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