Can DAO Governance Voting Actually be Implemented in the Real World?
Thai citizens will be able to exercise their right to vote on May 13 in less than a month. When it comes to voting for the prime minister, members of the House of Representatives, or even company directors, each of these positions calls for paper ballots or hand raising and counting. Today, we will suggest “DAO Governance” as a different method of voting in the Web 3.0 model.
What is DAO Governance?
We must first understand what DAO and governance in the world of Web 3.0 are. DAO (Decentralized Autonomous Organization) is a system designed to use tokens to vote for any projects without disclosing identity, whereas blockchain is the management and change used for governance in the world of Web 3.0. The right to vote for acceptance or rejection is available to the project's token holders. The blockchain’s protocol-level changes are also made through governance.
How will the election be with DAO Governance?
Quorum-based tokens are required for DAO voting, for instance, DAO members in the project must take part in the voting process. Whatever receives the most votes is the winner in accordance with the selection criteria. If the vote falls short of the required amount, the offers will be rejected.
This election method uses a voting protocol called Quadratic Voting (QV), which employs a mathematical calculation to improve decision efficiency and lessen the decentralization of some members' decisions within the DAO.
The possibility of a system attack for the general election exists in DAO. Many Web 3.0 projects typically use the independently accessible voting method with Permissionless Blockchain by utilizing tradeable and exchangeable tokens.
This could be vulnerable to Governance Attacks that give the attackers the power to vote. The attack takes place within the protocol, which makes it impossible to identify the attackers through coding.
Additionally, since the law has not yet endorsed DAO for the election, technology use is still prohibited. There may be a limit for a small group to create rules if it is implemented, whereas voting is probably done using digital currencies or Central Bank Digital Currency (CBDC), which can be instantly verified. NFT may also be modified to function as a voting ballot, such as for general NFT projects. The use of NFT can be monitored from an NFT address owned by the voters, making it easier to set a limit on the amount than the use of tokens or other types of general digital currencies, which are more difficult to monitor but simple to attack.
Advantages of DAO application in real life
With the decentralized solution and the capabilities of blockchain technology, which have obviously changed the world of cryptocurrency, the DAO concept becomes outstanding. The advantage of DAO is that it will put an emphasis on equality and being the most democratic when it is applied to real life, such as the election. It can verify votes in real time, display the outcome in a transparent manner, and enable everyone to contribute to improvement and change. DAO may thus be another option to take the voting process in the real world one step further.
Challenges and Trends in DAO Governance
Even though DAO Governance is far from perfect today, many sectors are investing in new governance mechanisms to encourage member engagement, equalize decentralization, and enable effective decision-making. It also carried out the trial, substituting quadratic voting and holographic resolution for traditional token voting. Until the ideal governance that can offer the greatest benefit to members and the larger ecosystem is met, further study is necessary to determine whether or not these two methods are possible.