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The paper introduces the Zero Point Senemosìa (ZPS) framework and the DAO Health Index (DHI) to quantify extreme voting power concentration in DAOs, while proposing the PARE protocol as a mechanism to mitigate governance risks and treasury capture.
Tags
Decentralized governance, DAO governance, voting concentration, governance
risk, blockchain governance, organizational science, cryptoeconomics
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None
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None
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Decentralized Autonomous Organizations (DAOs) promise democratic governance through
token-weighted voting, yet empirical evidence reveals extreme concentration of voting power
comparable to the world’s most unequal countries. This paper introduces the Zero Point Sen-
emosìa (ZPS) framework, a novel approach to quantifying governance health in DAOs through
quantum-inspired organizational modeling. We analyze three major DAOs—MakerDAO (MKR),
Lido (LDO), and Ethereum Name Service (ENS)—revealing distinct governance pathologies:
MKR exhibits polarized debate (DHI = 0.68), LDO demonstrates silent consensus masking con-
centration (DHI = 0.71), and ENS presents acute treasury capture risk despite high participation
(DHI = 0.59).
Our analysis reveals Gini coefficients ranging from 0.80–0.89 and Nakamoto coefficients as
low as 4, indicating that merely 4–7 entities control 51% of governance in these protocols worth
$14B+ in total value locked. We introduce the DAO Health Index (DHI) as a quantitative
governance metric and propose the Protocol for Auto-corrective Reconfiguration and Equilib-
rium (PARE) as a framework for designing self-correcting governance mechanisms. Our findings
have direct implications for regulatory policy, institutional investment, and the design of future
decentralized systems.
Authors
Fabian Leo Naressi
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Slug
Short Description
The paper introduces the Zero Point Senemosìa (ZPS) framework and the DAO Health Index (DHI) to quantify extreme voting power concentration in DAOs, while proposing the PARE protocol as a mechanism to mitigate governance risks and treasury capture.
Tags
Decentralized governance, DAO governance, voting concentration, governance
risk, blockchain governance, organizational science, cryptoeconomics
Research Type
None
Sensemaking For
None
Featured
CTA URL
No response
Banner Image
Description
Decentralized Autonomous Organizations (DAOs) promise democratic governance through
token-weighted voting, yet empirical evidence reveals extreme concentration of voting power
comparable to the world’s most unequal countries. This paper introduces the Zero Point Sen-
emosìa (ZPS) framework, a novel approach to quantifying governance health in DAOs through
quantum-inspired organizational modeling. We analyze three major DAOs—MakerDAO (MKR),
Lido (LDO), and Ethereum Name Service (ENS)—revealing distinct governance pathologies:
MKR exhibits polarized debate (DHI = 0.68), LDO demonstrates silent consensus masking con-
centration (DHI = 0.71), and ENS presents acute treasury capture risk despite high participation
(DHI = 0.59).
Our analysis reveals Gini coefficients ranging from 0.80–0.89 and Nakamoto coefficients as
low as 4, indicating that merely 4–7 entities control 51% of governance in these protocols worth
$14B+ in total value locked. We introduce the DAO Health Index (DHI) as a quantitative
governance metric and propose the Protocol for Auto-corrective Reconfiguration and Equilib-
rium (PARE) as a framework for designing self-correcting governance mechanisms. Our findings
have direct implications for regulatory policy, institutional investment, and the design of future
decentralized systems.
Authors
Fabian Leo Naressi
Related Apps
Related Mechanisms
Related Case Studies
Related Research
Related Campaigns
Submission Checklist