Chainalysis published a research study showing that although decentralized autonomous organizations (DAOs) have emerged as the future of decentralized corporate governance, there have been several weaknesses in their functioning.
According to the study, DAOs form the cornerstone of many blockchain and Web3 projects. Internet-native and blockchain-based, DAOs are intended to offer a new, democratized management structure for businesses, projects, and communities, in which any member can vote on organizational decisions just by buying into the project.
Concentrated Voting Power
However, the latest report by Chainalysis indicated although the process in which DAOs work is normally described as a way to decentralize power, ownerships of DAOs are highly concentrated.
Chainalysis analyzed the functioning of ten major DAO projects and found some clear details that DAOs are not as decentralized as intended to be. The voting power in DAOs has been largely concentrated, the study revealed.
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