The decentralized autonomous organization (DAO), as a form of organizational structure, has all the potential to be the future of organizing for any group size, type, and purpose. DAOs are built with transparency, democratization, and automation in mind — making them ideal for any organization that wants to govern effectively and equitably, in theory.
In practice, many DAOs are plagued with corruption, inefficiency, lack of participation and even understanding of how it all works by most members, hacking and governance exploits, and much more of what turns a dream into a nightmare.
And, for better or worse, the fault is in the design itself. Let’s look at what’s creating the great bottleneck between the good intentions of DAO creators and making them into reality.
The core problem
While DAOs removed many of the barriers to entry in terms of capital requirements (even $1 can buy governance tokens), geography, race/ethnicity/class/gender/etc., and other limitations of the old organ
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