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📝 Chainalysis: top 10 DAOs are way too far from decentralization

OneArt has made up a summary of the State of #Web3 Report preview. Here’re the highlights:

📍The company’s research shows that 90% of voting power in several top #DAOs belongs to less than 1% of holders. Thus, organizations meant to be decentralized turned out to be centralized. If that 1% team up, they can outvote the remaining 99%.

📍The number of those who can create a proposal is critically low. Only between 1 in 1,000 and 1 in 10,000 holds enough #tokens to do so. The same goes for passing a proposal: between 1 in 10,000 and 1 in 30,000 holders can do it.

📍The Solend protocol case is an example of an issue that DAOs face. When Solana’s price dropped, the whale’s large margin position could upend the entire Solana ecosystem. The DAO called a vote to overtake the whale’s account, and then again — to invalidate the proposal and make the whale unwind their position. The case raises a crucial question: can DAOs act for the benefit of all users?

📍DAOs governance systems differ, but most run on similar infrastructure, e.g., voting systems like Snapshot and chat servers like #Discord. For example, #Uniswap implements temperature checks and consensus checks to pass the idea. Dream DAO uses SkywalkerZ #NFTs as governance tokens and fundraising incentives.

📍In terms of treasury sizes, #DeFi-related DAOs top the chart. This category makes up 83% of all DAO treasury value held. It’s also the biggest group accounting for 33% of all DAOs.

📍Chainalysis predicts mergers and acquisitions to become more commonplace as the DAO model matures.

Top DAOs’ governance policy seems to undermine the very idea of decentralization on which Web3 is based. The research confirms Jack Dorsey’s idea that Web3 is “a centralized entity with a different label.” DAOs need to find ways to escape the concentration of power. Otherwise, decentralization will remain a beautiful buzzword.



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