- Recent data suggest that DAOs are fast becoming digital companies.
- There might be a reduction in DAOs’ growth soon.
Decentralized autonomous organizations (DAOs) are generally managed using blockchain smart contracts. Also, the governance of ‘digital these companies’ is determined by shareholder votes. Most of these votes are conducted via discord.
Members of these DAOs meet physically once in a while. However, most of their meetings are conducted virtually. Using blockchain technology, transactions on DAOs are immutable and transparent.
DAOs’ governance activity exploded in the last year – Snapshot Labs’ data
A Snapshots Labs data revealed a huge rise in the number of DAOs in the last year. The data adds that this number is eight times more than the previous year. According to this data, the number of DAOs rose from 700 to more than 6,000 in 12 months. This number does not include DAOs without proposals.
While the number has risen in previous years, the latest rise remains the highest. The data further notes that there has been 8.5 times growth in the number of DAO proposals in the last year. Also, the total number of votes rose 8.3 times within the same period.
There are now 3.7m DAO votes compared to 448,000 in the previous year. However, the report noted that a small percentage of these DAOs are driving this participation increase. These are the DAOs that have been the most active.
Distribution of the total number of proposals. Source: Emre Caliskan.
About 10 percent of these DAOs are responsible for most of the new proposals. Sadly, 60 percent of DAOs haven’t had more than three new proposals since they became active. A DeepDAO data also states that PancakeSwap and Decentraland are the top two DAOs based on proposal counts.
The former has 3,300 proposals, while the latter has 1,200 proposals. The data added that there are only 72 DAOs with up to 100 proposals. However, if the draft bill before the senate is passed without changes, the growth rate of DAOs may be cut short. Part of the bill emphasizes that all crypto projects have registered licenses with regulators. Also, they must indicate full profiles of their founders and users.
An inspiration for other DAOs
Emre Caliskan, Electrical Capital’s engineer, claims that the ConstitutionDAO stood out among the other DAOs. This DAO became popular following his proposal to buy the original version of the US constitution. The actions of this DAO have been an inspiration to many other DAOs.
The ConstitutionDAO made a huge impression on several other DAOs despite facing some challenges. Despite its efforts at Sotheby’s public auction last year, the ConstitutionDAO failed in its bid to own the last original version of the US constitution. The DAO published a lengthy discord message to confirm the failure of its bid.
ConstitutionDAO’s discord announcement. Source: Discord
Regulators’ concerns
Regulators had major concerns regarding the efforts of the ConstitutionDAOs regarding their bids. A leaked draft of the US crypto bill started circulating on the internet four days ago.
Parts of the draft bill show that the regulators are deeply worried about the impact of the crypto industry. They were particularly worried about the operations of crypto exchanges and DAOs. They also expressed concern over the DeFi and stablecoin industry.
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