Attention Markets of Blockchain-Based Decentralized Autonomous Organizations

Abstract

The attention is a scarce resource in decentralized autonomous organizations (DAOs), as their self-governance relies heavily on the attention-intensive decision-making process of “proposal and voting”. To prevent the negative effects of proposers' attention-capturing strategies that contribute to the “tragedy of the commons” and ensure an efficient distribution of attention among multiple proposals, it is necessary to establish a market-driven allocation scheme for DAOs' attention. First, the Harberger tax-based attention markets are designed to facilitate its allocation via continuous and automated trading, where the individualized Harberger tax rate (HTR) determined by the proposers' reputation is adopted. Then, the Stackelberg game model is formulated in these markets, casting attention to owners in the role of leaders and other competitive proposers as followers. Its equilibrium trading strategies are also discussed to unravel the intricate dynamics of attention pricing. Moreover, utilizing the single-round Stackelberg game as an illustrative example, the existence of Nash equilibrium trading strategies is demonstrated. Finally, the impact of individualized HTR on trading strategies is investigated, and results suggest that it has a negative correlation with leaders' self-accessed prices and ownership duration, but its effect on their revenues varies under different conditions. This study is expected to provide valuable insights into leveraging attention resources to improve DAOs' governance and decision-making process.