kaal:claim:4015908-024

DAO governance built on fungible governance tokens is disfavored and dangerous because governance rights can be bought on open exchanges, whereas non-fungible reputation governance assures the highest levels of decentralization.

DAO governance that revolves around fungible governance tokens is disfavored and dangerous in this context as governance rights can be bought on open exchanges. By contrast, non-fungible reputation governance of the DAO assures highest levels of decentralization.

Wulf A. Kaal, Fair Token Launch (2022), III.2.d(1) Level of Decentralization, p. 12
https://ssrn.com/abstract=4015908 · source PDF

Wulf A. Kaal, Fair Token Launch (2022). SSRN: https://ssrn.com/abstract=4015908

• DAO governance rights are tradeable on open exchanges

failuresupport: arguedfailure: Purchasable governance rightsfamily: plutocratic-capturedaogovernance-designtokenomicsreputationdecentralization

• restated_by kaal:claim:4529715-020 Fungible governance tokens expose a DAO to vote buying and other forms of manipulation.
• extended_by kaal:claim:5254152-003 Fungible governance tokens deliver liquidity and transparency in DAO voting rights, but because they are trada...
• supported_by kaal:claim:4067783-012 The absence of proper decentralized governance built on non-fungible tokens is a key common denominator across...
• extends kaal:claim:3981021-024 Merit in the CHARITYxDAO is expressed by a non fungible reputation token that cannot be bought or sold, and vo...
• generalizes kaal:claim:5254152-037 Tiered membership models that tie governance rights and influence to token holdings introduce imbalance and a ...

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