Cambridge Report: DAO governance power is highly concentrated, approaching the world's most unequal countries

2024-12-04 13:06:25

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ChainCatcher news, a new analysis released by the Cambridge Centre for Alternative Finance shows that the governance power of decentralized autonomous organizations (DAOs) behind DeFi protocols is highly concentrated, with a level of concentration comparable to the world's most unequal countries.

By applying the Gini coefficient, the analysis found that the Gini coefficients of the top ten DAOs range from 0.97 to 0.99, indicating a high degree of power concentration. In contrast, South Africa's Gini coefficient is 0.63.

The analysis reveals that although DAOs claim to be decentralized, in reality, most decisions are still dominated by a small number of large token holders. The Cambridge team stated that they will further refine the data in the future to analyze the concentration of power within DAOs.

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