Crypto glossary
Ragequit
Ragequit is a DAO mechanism that lets a member who disagrees with a decision burn their shares and withdraw their part of the treasury before it applies.
The mechanism was introduced by Moloch DAO in 2019. After a proposal passes, there is a grace period during which any member who voted against it, or did not vote, can exit by burning their shares and receiving a proportional cut of the assets in the treasury. Only after that window closes is the approved proposal executed, so nobody is forced to fund a decision they oppose.
Ragequit protects minorities in small, capital-pooling DAOs and investment clubs, and it disciplines majorities: if a proposal is so unpopular that many members leave, the remaining treasury shrinks. Similar exit rights appear in later frameworks and are debated for larger protocols whose tokens trade at a discount to their treasury value.
It works best when the treasury holds liquid assets that can be split. Locked tokens, illiquid positions or a native token that crashes on exits make the fair share hard to calculate, and arbitrage traders sometimes buy cheap governance tokens just to ragequit at treasury value.
Example
A grants DAO approves spending half its funds on a single project; a member who voted no uses the seven-day grace period to ragequit and withdraws their 2% of the treasury in ETH first.