Dynamic Management of DAOs: Fluid Identity and Reputation

This article analyzes the main popular models of DAOs in terms of membership and voting rights management (token-based and social-based), noting that they lack sufficient dynamics. In order to solve this problem, the author proposes a reputation-based model and draws a dimension table of “potential reputation measurement”, which provides a practical reference for how DAOs can build sufficiently dynamic and fluid membership and voting rights management.

As we all know, DAOs currently do not achieve the desired level of autonomy and automation. The way they are implemented is more of a simulation of the vision of a “fluid on-chain governance process”, and the type of DAO we are striving for is more dynamic and intelligent.

In terms of giving users membership and voting rights, DAOs today do nothing more than two ways:

  • Token-based governance Users gain membership by holding, staking, staking, or earning tokens
  • Social-Based Governance Users gain membership by getting sponsorships, contributing to DAOs, or signing up

These mechanisms vary in terms of the degree of permissionless membership, voting rights, and participation thresholds. For example: You need to hold DeveloperDAO’s tokens to become a member, or hold 10 million UNI to initiate a proposal to the DAO.

Dynamic Management of DAOs: Fluid Identity and Reputation

Current DAO Mechanism

The diagram above enumerates most of the (not exhaustive) ways in which DAOs grant user membership. Regardless of the method used to obtain DAO governance rights, token-based or social-based, there is one thing in common – they are all static .

How dynamic can we be?

Some DAOs use tools such as CollabLand to create token faucets on discord to reward members with outstanding contributions; or use Coordinape to allow members in the community to review each other’s contributions. These are all great ways to give contributors more voting power, but none of them are very useful when it comes to adjusting or removing voting power. Our vision for the protocol also relies on evaluating and validating user contributions in some autonomous way, which will be the subject of future work.

Membership in a DAO should be fluid. We need to start designing DAOs that both capture the dynamism of web3 actors and recognize that those actors are cheap to switch between working on different protocols.

Questions to think about are:

  • How to reduce voting rights, or expel someone from the DAO?
  • How can we set behavioral thresholds in the protocol for DAO members, not just voting rights?
  • How to change DAO membership over time?
  • How do you ensure that DAO participants—who have a significant impact on governance protocols, culture, and the DAO’s longevity—are still the best people to make decisions for the DAO’s interests?

Becoming a member of the DAO should be a privilege, not a right.

Anyone can buy protocol tokens, attend a city meeting, or join a discord channel. But just because they hold a token, or change their avatar to that cat, don’t give them the right to govern the protocol or manage the treasury (extremely important!) forever and 100%.

The only DAO mechanism (to my knowledge) that removes membership on-chain is MolochDAOv2’s guildkick. It enables members to vote to fire other members, usually targeting those who have acted maliciously. This mechanism is often used as a first-mover defense to prevent potential risks to the DAO due to anger and withdrawal. However, such a highly hostile move does not meet our requirements for liquidity within the DAO. — guildkick is still a static proposal that can only be submitted at the right moment, not an autonomous solution.

Reputation-based DAO

Holding tokens can signal someone’s interest in being a part of it, but holding tokens alone is not enough to demonstrate that he is sufficiently committed to the protocol and the DAO’s well-being. For DAO membership and voting rights, it’s the user’s interaction with the protocol and community that really matters – that’s reputation .

Dynamic Management of DAOs: Fluid Identity and Reputation

DAO Member Potential Reputation Metrics

DAOs can measure dedication in their protocols based on network engagement, governance engagement, and community engagement. DAOs cannot rely solely on token ownership, but should require their members to participate in the protocol and DAOs to build reputation.

If whale investors are reluctant to stake their tokens, should they be given very large governance rights? If they don’t even have a POAP agreement, can they still sit together and discuss the big plan?

Membership in a DAO should be fluid.

For token-based voting, user switching costs are low — buy and sell any token, join any DAO with a few simple clicks on Uniswap. But DAOs cannot currently handle the same liquidity.

DAOs need memberships to be adjustable — users’ memberships should depend on their ability to consistently meet reputation metrics, rather than static one-time activities or purchases. If they can’t meet the on-chain minimum requirements, they should no longer be part of the DAO. Imagine how well-organized a DAO would be if the membership roster could be automatically updated, leaving the highest quality, most engaged members at all times. Just like in a country only citizens have the right to vote.

Let’s simulate:

Alice joins BobbyDAO, which oversees the Bobert protocol. Alice is currently the whale holding $BOB. Because she has reached the $BOB holding threshold, she can submit proposals and vote easily. However, Alice has neither staked $BOB in the protocol nor responded to a community call! So Alice should not have these rights.

Recently Bob has been thinking about strengthening his DAO. He felt that the reputation mechanism should work. This allows more $BOB stakers to have a say in the protocol than $BOB holders who don’t really care about the best interests of the protocol. He makes a decision: All users who have staked $BOB for at least 30 days in the past year can retain membership. Any time a user doesn’t meet the 30/365 ratio, they lose membership. If the user re-stakes, the DAO welcomes him back. In doing so, Bob hopes to keep the best protocol contributors in the DAO.

The future of DAOs is a programmatically maintainable, ever-changing community. Members are the lifeblood of the DAO, allowing the DAO to focus on its mission while benefiting from it. A DAO member who cannot organically cultivate a reputation in the protocol, perhaps the wrong arrangement, will drive the community towards gold power or autocracy.

Users will buy a lot of tokens, join a lot of discord, try and leave a lot of DAOs. A few will stay and use their tokens for the protocol, and even fewer will become long-term contributors. A DAO’s success is measured not by how many members it has, but by the quality of its proposals, and its ability to keep contributors in the protocol (or whatever else this DAO manages). A member that is useful today may not be useful tomorrow. We have to learn to build DAOs with flowing soldiers. This is why it is so important to keep the DAO dynamic and allow membership to evolve.

Fortunately, most of the interesting reputation measurement systems are on-chain or accessible through oracles for DAOs to adopt in their governance systems.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/dynamic-management-of-daos-fluid-identity-and-reputation/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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