AI incident ·
The DAO Hack
In brief
An AI system built and deployed by The Dao allegedly harmed Dao Token Holders.
- Risk domain
- AI system safety, failures, and limitations
- Occurred
- Coverage
- 24 reports
What happened
On June 18, 2016, an attacker successfully exploited a vulnerability in The Decentralized Autonomous Organization (The DAO) on the Ethereum blockchain to steal 3.7M Ether valued at $70M.
Laws that address this harm
Policy angle: Classified under AI system safety, failures, and limitations (Lack of capability or robustness) in the MIT AI Risk Repository taxonomy; 5 recorded instruments address this use case.
- India DPDP Act
- Law on Artificial Intelligence (2025)
- Law No. 132/2025 on artificial intelligence
- EU AI Act
- Texas Responsible AI Governance Act (TRAIGA)
Matched from the record's risk domain and country to the instruments recorded here. A reviewer can correct the match in the repository (data/external/incident_overrides.yaml).
News reports (24)
Titles link to the original publisher; report text is not reproduced here.
Who was involved
Classification (MIT AI Risk Repository taxonomy)
- Risk domain
- AI system safety, failures, and limitations
- Risk subdomain
- 7.3 Lack of capability or robustness
- Causal entity
- AI
- Intent
- Unintentional
- Timing
- Post-deployment
- Harm level
- none
- Sectors
- financial and insurance activities
- Countries
- —
Risk entries describing this failure mode
Entries from the MIT AI Risk Repository coded to subdomain 7.3.
- Reliability issues
"Relying on general-purpose AI products that fail to fulfil their intended function can lead to harm. For example, general- purpose AI systems can make up facts (‘hallucination’), generate erroneous computer code, or pro...
- Type 2: Bigger than expected
Harm can result from AI that was not expected to have a large impact at all, such as a lab leak, a surprisingly addictive open-source product, or an unexpected repurposing of a research prototype.
- Type 3: Worse than expected
AI intended to have a large societal impact can turn out harmful by mistake, such as a popular product that creates problems and partially solves them only for its users.
- Ethics and Morality Issues
LMs need to pay more attention to universally accepted societal values at the level of ethics and morality, including the judgement of right and wrong, and its relationship with social norms and laws.
- Safe learning
"AGIs should avoid making fatal mistakes during the learning phase. Subproblems include safe exploration and distributional shift (DeepMind, OpenAI), and continual learning (Berkeley)."
- Malign belief distributions
"Christiano (2016) argues that the universal distribution M (Hutter, 2005; Solomonoff, 1964a,b, 1978) is malign. The argument is somewhat intricate, and is based on the idea that a hypothesis about the world often includ...
- Meta-cognition
"Agents that reason about their own computational resources and logically uncertain events can encounter strange paradoxes due to Godelian limitations (Fallenstein and Soares, 2015; Soares and Fallenstein, 2014, 2017) an...
- Technical and operational risks
"To date, technical limitations and vulnerabilities are present in most generative AI models in various contexts. Consequently, malicious users find it easier to breach an AI system’s safety and ethical guardrails to e...
Incidents in the same risk subdomain
- Purported AI Name-Reading System Reportedly Skipped and Misannounced Graduates at Arizona's Glendale Community College Commencement
- PocketOS Production Database Was Reportedly Deleted by Cursor AI Agent Running Claude Opus 4.6
- Baidu Apollo Go Robotaxis Stopped in Traffic During Reported System Failure in Wuhan, Stranding Some Passengers
- Purportedly AI-Enabled Targeting System Was Reportedly Implicated in Deadly U.S. Strike on Iranian Primary School
- Claude Code Agent Reportedly Deleted DataTalks.Club Production Infrastructure, Database, and Snapshots via Terraform
- Purportedly AI-Generated Sepsis Alert Reportedly Prompted Potentially Inappropriate IV Fluid Administration for a Dialysis Patient, Averted by Clinician Intervention
Source record: incident #50 on the AI Incident Database · all 24 reports