Perils of current DAO governance

TL;DR

This paper critically examines current DAO governance systems, revealing significant vulnerabilities such as vote manipulation, lack of true decentralization, and privacy issues, supported by case studies and protocol reviews.

Contribution

It provides a comprehensive review of existing DAO governance protocols and highlights their privacy and security vulnerabilities through detailed case studies.

Findings

Vote buying, selling, and coercion are easy.

Decentralization is largely a myth in practice.

Privacy and verifiability trade-offs pose significant risks.

Abstract

DAO Governance is currently broken. We survey the state of the art and find worrying conclusions. Vote buying, vote selling and coercion are easy. The wealthy rule, decentralisation is a myth. Hostile take-overs are incentivised. Ballot secrecy is non-existent or short lived, despite being a human right. Verifiablity is achieved at the expense of privacy. These privacy concerns are highlighted with case study analyses of Vocdoni's governance protocol. This work presents two contributions: firstly a review of current DAO governance protocols, and secondly, an illustration of their vulnerabilities, showcasing the privacy and security threats these entail.