{"title":"Governance impacts of blockchain-based decentralized autonomous organizations: an empirical analysis","authors":"Olivier Rikken, Marijn Janssen, Zenlin Kwee","doi":"10.1080/25741292.2023.2270220","DOIUrl":null,"url":null,"abstract":"The rapid rise in blockchain-based Decentralized Autonomous Organizations (DAOs) offers policy-makers and decision-makers new opportunities to automatically execute decisions and processes that help enhance transparency, accountability, participation and trust. Yet, many DAOs have a limited lifespan. There is little empirical evidence of the effect of governance elements on the viability of DAOs. Using 220 on-chain governed DAOs, this paper analyses how governance elements (accountability, decision/voting, and incentives) influence the viability of DAOs in the long-term. The findings show that DAOs without weighted decision-making and without incentive structures are more viable than those with weighted decision power and incentive mechanisms. This suggests that financial and share-like DAO governance elements do not or may even negatively contribute to the long-term viability of DAOs. Also, voting power distribution is found to have a statistically significant influence on DAOs’ viability. We further propose a preliminary theory that relates governance elements to the long-term viability of DAOs. These insights will help policy-makers in designing more viable DAOs. Future research should investigate how DAO objectives, the chosen deployment infrastructure and the type of users can impact the long-term viability of DAOs.","PeriodicalId":20397,"journal":{"name":"Policy Design and Practice","volume":null,"pages":null},"PeriodicalIF":3.1000,"publicationDate":"2023-10-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"1","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Policy Design and Practice","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1080/25741292.2023.2270220","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"PUBLIC ADMINISTRATION","Score":null,"Total":0}
引用次数: 1
Abstract
The rapid rise in blockchain-based Decentralized Autonomous Organizations (DAOs) offers policy-makers and decision-makers new opportunities to automatically execute decisions and processes that help enhance transparency, accountability, participation and trust. Yet, many DAOs have a limited lifespan. There is little empirical evidence of the effect of governance elements on the viability of DAOs. Using 220 on-chain governed DAOs, this paper analyses how governance elements (accountability, decision/voting, and incentives) influence the viability of DAOs in the long-term. The findings show that DAOs without weighted decision-making and without incentive structures are more viable than those with weighted decision power and incentive mechanisms. This suggests that financial and share-like DAO governance elements do not or may even negatively contribute to the long-term viability of DAOs. Also, voting power distribution is found to have a statistically significant influence on DAOs’ viability. We further propose a preliminary theory that relates governance elements to the long-term viability of DAOs. These insights will help policy-makers in designing more viable DAOs. Future research should investigate how DAO objectives, the chosen deployment infrastructure and the type of users can impact the long-term viability of DAOs.