# kaal:claim:4529715-015

**Claim.** The most significant risk of bad DAO governance is centralization, in which a small group holds a disproportionate share of power or influence and thereby undermines the decentralized nature of the organization.

**Type.** failure  **Support.** argued

**Source quote.**

> centralization, where a small group of individuals or entities hold a disproportionate amount of power or influence within the DAO, which can undermine the decentralized nature of the organization.

**From.** Wulf A. Kaal, Josh Bykowski, *Decentralized Autonomous Organizations (DAO) – A Market Meta Analysis* (2023), Current state of DAOs, page 17

**Cite as.** Wulf A. Kaal, Josh Bykowski, Decentralized Autonomous Organizations (DAO) – A Market Meta Analysis (2023). SSRN: https://ssrn.com/abstract=4529715

**Verify.** sha256 of source PDF `2d71961e8c449afbeaf45ca4f53de8a575d45c77d6960b767d3d1d0874f296b5` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Bykowski%20-%202023%20-%20Decentralized%20Autonomous%20Organizations%20%28DAO%29%20%E2%80%93%20A%20Market%20Meta%20Analysis.pdf

**Failure mode.** creeping-centralization  (family: recentralization-drift)

**Topics.** dao, decentralization, governance-design

**Keywords.** dao, centralization, governance-failure, power-concentration

**Related claims.**

- extended_by: https://wulfkaal.github.io/claims/5254152-005

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.