An empirical study on deployment in cross-chain decentralised autonomous organisations

Abstract

Decentralised Autonomous Organisations (DAOs) are self-governing democratic entities that operate and provide services via smart contracts on behalf of their users. Certain DAOs, particularly Decentralised Exchanges (DEXs), have recently expanded their market reach through cross-chain deployment and integration, giving rise to Cross-chain DAOs (XDAOs). These XDAOs face unique governance, deployment, and operations challenges, introducing added complexity and risks compared to traditional single-chain DAOs. While existing research has focused primarily on single-chain DAOs, we observe a shift in practice with DAOs to favour cross-chain deployments. The three largest protocols, Uniswap, Curve, and PancakeSwap, which together represent over half of the total value locked in DEXs, have been deployed across 22, 17, and 9 chains, respectively. This creates a research gap that our study addresses. In this study, we review 48 cross-chain deployments and numerous XDAO interactions, using data primarily from their respective discussion forums. Through thematic and root cause analysis, we identify eight requirements, deviations between DEXs, seven lessons learned for cross-chain deployment, and a framework to generalise the governance and deployment processes in XDAOs. As a result, we provide an improved classification of XDAO governance, highlighting limitations and future directions for cross-chain expansion.