Challenges of Effective Decision Making in Decentralized Autonomous Organizations (DAOs)

Romex K Jha

blockchain technology,DAO, decision-making, decentralized governance.

Decentralized Autonomous Organizations (DAOs) have emerged as a revolutionary paradigm for decentralized governance and decision-making, leveraging blockchain technology to enable community-driven and transparent decision processes. However, despite their potential to revolutionize traditional organizational structures, DAOs encounter various challenges in achieving effective decision-making. This paper presents a brief analysis of the challenges faced by prominent DAOs, including Maker DAO, Uniswap, MolochDAO, Gitcoin DAO, Big Green DAO, Friends with Benefits DAO, Flamingo DAO, Metacartel, BanklessDAO, and Balancer SubDAO. Drawing from an extensive review of  research papers and journals, this study explores the multifaceted factors influencing DAO decision-making, including coordination hurdles, participation issues, voting mechanisms, token distribution, community engagement, regulatory and legal complexities, and future prospects. By gaining a comprehensive understanding of these challenges, this research aims to propose innovative solutions to enhance the effectiveness of decision-making processes in DAOs, empowering them to overcome obstacles and fulfill their transformative potential in the decentralized ecosystem.

https://doi.org/10.31871/WJRR.17.1.11