Current DAO infrastructure isn’t truly decentralized, but it can be

Upland: Berlin is here!

Over the past few years, blockchain technology has paved the way for a new governance model known as a decentralized autonomous organization (DAO). DAOs are built on the philosophy of doing away with the centralized hierarchies that provide complete control over all decision-making within a given company, turning traditional corporate structures upside down and making proposals about the future of the organization a reality. Give shareholders the power to vote.

Unfortunately, this didn’t work out very well in practice. Early attempts were fraught with problems, many of which stemmed from the fact that these systems were not adequate. totally decentralized as they think. Luckily, DAO can be built in a way that delivers on the promise of its predecessor, so it’s time to see this change in action.

An Honest View of the First Generation of DAOs

DAOs seem like an idea whose time has come. At first glance, the concept of an organization that gives voting rights to all members seems very fair. This is also in line with the general sentiment behind the creation of blockchain technology. However, just because these organizations are designed to be decentralized does not mean that they operate decentralized in the field. In fact, the term DAO is often used loosely, and the reality of certain organizations is not as decentralized as advertised.

In many cases, a relatively small number of governance token holders actually control a significant portion of the voting power.This is because they have deep funds or exchange Because they control a huge amount of user funds. Other times, the DAO community has only superficial control over the details of the project, making the whole practice a more or less empty act.

Worse, decisions are sometimes made by a centralized development team. Regardless Community votes are ignored, as the DAO has no concrete means of enforcing the will of the community. When users begin to find their voices compromised by such issues, it can lead to “voter apathy”, lower participation, and worsen centralization issues.

The bottom line is that architectures promoted as distributed are sometimes not at all, effectively removing the main advantage that DAOs provide. However, there are ways to deal with these issues.

What the DAO should be

Moving to purely distributed DAO management is one of the first changes all DAOs should implement. This means that we do not have a core group of developers who own the majority of the issued tokens or have unfettered powers that go against the will of the community. All contributors should be able to submit and vote on upgrade proposals. These suggestions should be forwarded throughout the community independently of other organizations. all participants to raise their voices. Additionally, the infrastructure must be built to enforce these decisions after they are made, eliminating developer authority over the heads of the community.

Of course, delegation of roles and tasks is still important, but the DAO community can also decide this. Work can be published and anyone can offer to take on the task. Ultimately, other members can vote on which candidate is the best and divide the work on a meritocracy.

Another important element of a functional DAO framework is transparency. This is not to say that individuals’ voting methods should be fully public, but there should be clear access to voting results and verifiable procedures for enforcing those decisions. We also need a clear communication channel where all members, developers and other stakeholders can access the latest news and information about the project and all the rules that define the DAO itself. Incorporating this level of transparency from the ground up is essential to building trust and loyalty among members, making it extremely difficult for any entity on the network to abuse its power.

continuous evolution

For community governance to be truly effective, there must be an ongoing discussion of evaluating DAO performance and continuing to enhance it. These structures should never truly be “finished”, as extenuating circumstances in the future may always lead to the need for evolution and change. New risks may arise and economic conditions may develop into unforeseen circumstances. But this is what makes true decentralized governance so powerful. Once the community is informed and able to speak up, it will be able to respond organically to new challenges and needs.

The DAO model can bring this technology to users around the world. Any business or project could operate in such a way that it would eventually move these systems away from the hierarchical approach that has led to failure and corruption. Giving real democratic power to entire communities and promoting transparent practices is his future for DAOs, and the time has come for these organizations to transition.

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