2024/10/16 by Tanusree Sharma, Sharma, Tanusree, Yujin Potter +11
Computer Science · Engineering · #Blockchain Technology Applications and Security #Computational Engineering #Computers and Society (cs.CY) #Cryptography and Security (cs.CR) #Digital Transformation in Industry #FOS: Computer and information sciences #Finance #Human-Computer Interaction (cs.HC) #Social and Information Networks (cs.SI) #and Science (cs.CE)
paper · pdf · doi:10.48550/arxiv.2410.13095
openalex publication_date 2024/10/16 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/28
Decentralized Autonomous Organizations (DAOs) resemble early online communities, particularly those centered around open-source projects, and present a potential empirical framework for complex social-computing systems by encoding governance rules within "smart contracts" on the blockchain. A key function of a DAO is collective decision-making, typically carried out through a series of proposals where members vote on organizational events using governance tokens, signifying relative influence within the DAO. In just a few years, the deployment of DAOs surged with a total treasury of 24.5 billion and 11.1M governance token holders collectively managing decisions across over 13,000 DAOs as of 2024. In this study, we examine the operational dynamics of 100 DAOs, like pleasrdao, lexdao, lootdao, optimism collective, uniswap, etc. With large-scale empirical analysis of a diverse set of DAO categories and smart contracts and by leveraging on-chain (e.g., voting results) and off-chain data, we examine factors such as voting power, participation, and DAO characteristics dictating the level of decentralization, thus, the efficiency of management structures. As such, our study highlights that increased grassroots participation correlates with higher decentralization in a DAO, and lower variance in voting power within a DAO correlates with a higher level of decentralization, as consistently measured by Gini metrics. These insights closely align with key topics in political science, such as the allocation of power in decision-making and the effects of various governance models. We conclude by discussing the implications for researchers, and practitioners, emphasizing how these factors can inform the design of democratic governance systems in emerging applications that require active engagement from stakeholders in decision-making.