The past year has been one big growth spurt for DAOs (Decentralized Autonomous Organizations), but not everyone in the space is convinced that they are shaping up properly or in a way that will ensure success.
Before we dive into this, it is important to know that DAO are public organizations with no central leadership. Decisions are made by group members by voting on management proposals in an automated and decentralized manner.
It could be something like launching a decentralized exchange, for example Uniswap or as a small group of friends pooling party or vacation funds.
Many are driven by policy or mission, but they all exist for a purpose, says Parker McKerley, CEO Decent LabsTechCrunch said.
At the moment, there are over 1.7 million holders of governance tokens in nearly 5,000 DAO organizations. data on DipDAO. The data showed organizations had more than $10 billion in DAO treasuries, up $552.4 million from the previous month.
While the Treasury total is higher this month, it is below the November 2021 peak of $13.2 billion.
But what happens when the hype fades? People stop voting, treasures can wither and be abandoned, dead communities become “DAO graveyards”.
“I wouldn’t call DAOs more frothy than tech startups,” McCurley said. “I think it’s identical to startups. There are many great concepts that don’t fit the product and the market, and for one reason or another, they don’t scale and achieve long-term success.”
To prevent this from happening, there needs to be a change in how community members view and shape DAOs, Imran Khan, a core contributor to the DAO Alliance and web3 accelerators, told TechCrunch.
building with a purpose
“DAOs that launch should have the product in mind,” Khan said. “Without a product and a team behind it, it will be difficult to be self-sustaining.”
Credit: techcrunch.com /