VOTING IN DAOs

Abstract

In recent years the adoption of smart contracts, in blockchain platforms, has increased substantially. One of the main applications of smart contracts are the so called Decentralized Autonomous Organizations (DAO), which originated from an idea envisaged by Buterin, in his Ethereum white paper. Indeed, DAOs are decentralized organizations, where the members implement their decisions using smart contracts. In the paper we introduce a simple framework for a DAO, and then we discuss some governance issues. In particular, we focus on how DAO members could be induced to dedicate sufficient time to voting sessions, for a proper functioning of the organization. Indeed, recent empirical research suggests how the members’ participation rate, to voting activities, has a meaningful positive correlation with to a DAO's performance. More specifically, we formalize the notion of attention time and propose a simple model for the so-called Holographic Consensus, a protocol introduced by the DAOStack platform to solve the issue of limited time dedicated to governance, discussing under what conditions DAO members may choose the so-called boosting voting procedure.