Shiba Inu Launches ShibDAO While Investigating Shibarium Rug Pull Schemes

Jamie Larson

Jamie Larson

— 3 min read
Shiba Inu Launches ShibDAO While Investigating Shibarium Rug Pull Schemes

Shiba Inu's Shibarium development team opened an internal investigation into alleged rug pull activities while simultaneously launching ShibDAO, the ecosystem's comprehensive decentralized governance framework. According to BeInCrypto, Davinci.Shib, a core Shibarium contributor, disclosed on May 31 that certain entities within the network have been profiting from the system while simultaneously discrediting it. The probe targets bad actors who exploit the Shibarium network through deceptive tokens and manipulated hype campaigns.

The investigation coincides with the May 29 launch of ShibDAO, which transitions decision-making power from centralized entities to community members holding SHIB, BONE, LEASH, or TREAT tokens. The Crypto Basic reports that this governance shift ends power centralization within the Shiba Inu ecosystem, allowing the community to propose, vote on, and decide the project's future roadmap.

Four-Tier Governance System Establishes Specialized DAOs

ShibDAO operates through four distinct decentralized autonomous organizations, each managing specific ecosystem functions. SHIB DAO oversees community initiatives and social activities, while BONE DAO focuses on Shibarium's technical development and protocol upgrades. LEASH DAO handles governance disputes and conflict resolution, and TREAT DAO manages innovation funding and decentralized application development.

Bitcoinist details how the system launches with fully operational infrastructure, including active staking mechanisms, proposal submission capabilities, and accessible voting tools. The Bury 2.0 staking platform enables users to lock tokens for specified periods, earning voting escrow power based on both stake size and duration. Off-chain voting operates through Snapshot, allowing proposal creation without gas fees while maintaining real-time connection to on-chain staking data.

Investigation Targets Ecosystem Exploitation Patterns

The rug pull investigation addresses growing community concerns about malicious actors exploiting Shibarium for quick profits. U.Today reports that DavinciShib called out individuals who mock the project while benefiting from its infrastructure, describing them as "parasites still feeding off the ecosystem."

Recent incidents include fake versions of legitimate projects like Bad Idea AI, where scammers impersonate real partners to deceive users. Coindoo notes that the development team has adopted a more aggressive stance against internal manipulation, moving beyond previous warnings to active investigation and potential disclosure of verified findings.

The dual announcement reflects broader cryptocurrency industry trends toward decentralized governance and security accountability. Blockchain News indicates that 2025 represents a pivotal year for decentralized governance, with major financial entities like BlackRock and State Street encouraging active participation in online shareholder voting.

Cryptopolitan reports that DAOs now manage over $22 billion in market capitalization, with Uniswap leading at $5.4 billion in treasury holdings. However, smaller DAOs with inactive voting face increased risks of governance attacks and treasury exploitation, making security investigations like Shibarium's increasingly necessary.

Traditional Finance Implications and Future Outlook

The ShibDAO launch represents part of cryptocurrency's broader challenge to traditional financial structures through decentralized governance models. Emerald Insight research shows that cryptocurrency adoption serves as a precursor to participating in decentralized blockchain ecosystems, with decentralized governance providing benefits that traditional central banks cannot guarantee.

Traditional financial institutions increasingly recognize the need to adapt to decentralized technologies. Recent regulatory frameworks, including the FDIC's March 2025 guidance clarifying crypto-related activities for supervised institutions, suggest growing institutional acceptance of blockchain-based governance models.

The investigation's timing during the governance transition demonstrates the cryptocurrency industry's commitment to building sustainable, trustworthy decentralized systems. While DAOs offer transparent, community-driven decision-making advantages over traditional hierarchical structures, they require robust security measures to prevent exploitation and maintain participant confidence.

For readers interested in exploring the comprehensive tools available for decentralized autonomous organizations, DAO Times provides an extensive guide to DAO tooling for 2025. This resource covers over 60 specialized tools across categories including DAO creation platforms, governance and voting systems, treasury management solutions, community management tools, analytics platforms, and cross-chain interaction protocols. The guide explains how modern DAOs have evolved from simple token-weighted voting to complex multi-layered governance systems with AI integration, Zero-Knowledge privacy features, and modular architectures. Readers will gain practical knowledge about specific platforms like Aragon OSx, Snapshot, Safe, and emerging AI-driven governance solutions that are reshaping how decentralized organizations operate and make decisions in 2025.

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