# kaal:claim:3949098-019

**Claim.** Reputation non fungible token staking removes counterparty risk because the desire to preserve and increase reputation scores dominates DAOIC decision making, making bad actors less likely to appear since their reputation would inevitably suffer.

**Type.** mechanism  **Support.** argued

**Holds when.**

- reputation scores are durable and visible to the group

**Source quote.**

> Similarly, RNFT staking by DAOIC members removes counterparty risk. The desire to preserve and increase RNFT scores predominates the DAOIC decision making. Therefore, bad actors are less likely to occur in the system as their reputation would inevitably suffer.

**From.** Wulf A. Kaal, *Reputation as Capital – How DAOs Upgrade Finance* (2021), II. Basic Concept, 3. Risk Optimization, page 13

**Cite as.** Wulf A. Kaal, Reputation as Capital – How DAOs Upgrade Finance (2021). SSRN: https://ssrn.com/abstract=3949098

**Verify.** sha256 of source PDF `04297905564a6092b2db7640561f58fd374d3114c79527357bad09d11b909819` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202021%20-%20Reputation%20as%20Capital%20%E2%80%93%20How%20DAOs%20Upgrade%20Finance.pdf

**Topics.** risk-and-incentives

**Keywords.** counterparty-risk, rnft-staking, bad-actors, risk-mitigation, daoic

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