Good governance
“Good governance” – a cartoon that illustrates the challenges of decentralized governance models.
Determining who governs and the characteristics of their behavior have been a key basis for success and failure throughout humanity.
Decentralized computing, has opened the possibility of new governance mechanisms that reduce the need for managers or traditional hierarchies, as the rules are embedded into the code.
Many Web3.0 companies use these structures, called Decentralized Autonomous Organizations (or DAOs), to make consensus-based decisions on everything from product development to business strategy.
The belief is that DAOs are less susceptible to corruption, centralization, and other human shortcomings. The challenge with this model is what’s called the ‘DAO trilemma’ or how to manage scale, quality and access.
For example, as a DAO grows and the number of decisions multiply, there will need to be new voting mechanisms to cope with variable levels of knowledge on any one topic.
Also, those who are active members of the DAO will tend to want to ‘take the wheel’ and control the agenda of what topics are voted on or not.
The best form of governance is one exercised so artfully as to be almost invisible, but getting this whittled down to an algorithm is likely to require a lot of study and patience.
