Decentralized governance in the context of Web3 and DAOs refers to the decentralized, blockchain-based system where rules, decisions, and resource allocation are managed collectively by participants through transparent, automated mechanisms like smart contracts. Rather than concentrating decision-making power in a traditional hierarchy, decentralized governance distributes authority across different scales and functions of the organization.
Types of Governance
community-governance
Operates at Constituency Scale to safeguard and evolve the network’s overarching purpose. Community governance includes a broad base of stakeholders who may not be directly involved in operations but are aligned with the network’s purpose. It uses slower, more deliberative mechanisms like conviction voting and optimistic governance to make long-term decisions about network direction and treasury allocation.
operational-governance
Functions at test-pattern (small autonomous teams) coordinate their activities. Operational governance provides the flexibility and autonomy needed for teams to execute effectively while maintaining coordination across the network.
stakeholder-governance
Focuses on aligning key stakeholder interests and managing relationships between different participants in the network. This includes coordinating between active contributors, token holders, users, and other parties who have a direct stake in the network’s success. Stakeholder governance helps balance competing interests while maintaining alignment with the network’s purpose.
Articles on governance:
Governance for Better Futures series:
- Governance for better futures - DAO 2 DAO Co-operation
- Governance for better futures - Meta-governance
- Governance for better futures - New and Old
DAO Primitives Articles
- DAOs aren’t things… they are flows.
- Scale and the levers that provide DAOs their power
- DAOs - From fractal primitives to network scale.
- Minimum Viable Permissionless-ness
- Building DAOs as scalable networks