kaal:claim:3782203-031

Charging admission to a DAO disincentivizes defection because the sunk cost of joining makes cheating expensive when rejoining would require paying again, a mechanism the authors identify as costly signaling that works better the more cheaters the surrounding environment contains.

First, we can disincentivize defection/betrayal by charging admission to the DAO. With the sunk cost of joining, it is more expensive to cheat, since then it would be expensive to rejoin even if members could be anonymous. This is described as costly signaling.

Craig Calcaterra, Wulf A. Kaal, A Technical Perspective on Decentralization (2021), Application to reputation tokens, p. 20
https://ssrn.com/abstract=3782203 · source PDF

Craig Calcaterra, Wulf A. Kaal, A Technical Perspective on Decentralization (2021). SSRN: https://ssrn.com/abstract=3782203

• anonymous membership
• environments with many bad actors

mechanismsupport: arguedconsensus-and-securitydao

• restated_by kaal:claim:3981021-032 Charging an admission or denial of service fee to become a voting associate disincentivizes betrayal and defec...

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