DigixDAO is not only known as a coin (DGX) in the altcoin news – it is also an impressive project which aims to present a new concept in the blockchain space. In times when decentralized governance remains a challenging topic mainly because of regulation, the DigixDAO COO Shaun Djie decided to talk to one media outlet and help us get a better understanding of some of these challenges.
For those of you who are not following our news, Digix recently shuttered its DAO project after a user vote. Also, the project was one of the earliest to arrive on the scene after executing an ICO in 2016. The goal of DAO was to encourage the growth of projects around Digix and its gold-backed DGX token – up until the issues which included a controversial governance mechanism launched in 2018 which rewarded users for voting with the majority.
More recently, members started expressing their dissatisfaction that there was no way to withdraw their funds from the DAO. This dissent led the Digix team to devise the “Project Ragnarok” with a quarterly vote where members could decide if they want to dissolve the DAO entirely.
In the words of the DigixDAO COO Shaun Djie, even though the project will be dissolved, it does not mean that the DAO itself fundamentally failed. As Djie poitned out, there were no malicious actors and the governance parameters functioned exactly as they should.
““Like every other token project, I think it’s fair to say that the distribution curve of [DigixDAO’s DGD] tokens is quite skewed, in that the top ten to twenty owners will naturally hold weight over the entire supply system. So, in the context of a DAO, this means voting power isn’t equitably distributed,” he said.
One way to overcome this, as per the DigixDAO COO Shaun Djie, is to ensure that the long tail of smaller token holders is motivated to vote. He explained:
“A reputation-based voting system means that smaller voters could gain more voting power over time. Even though you may not have as many tokens, [if] you’re able to amass influence and reputation in the ecosystem, it gives you a bigger weight. The entire thing could be driven on the blockchain using identifiers assigned to your wallet address.”
Still, even he was quick to highlight a critical drawback:
“I think it’s something that takes years to build out. Managing the community’s expectation at the beginning is something we learned a lot about.”
While we are waiting for DigixDAO to shine again and present itself in a new light in the blockchain news, we will keep updating this topic in the news.
DC Forecasts is a leader in many crypto news categories, striving for the highest journalistic standards and abiding by a strict set of editorial policies. If you are interested to offer your expertise or contribute to our news website, feel free to contact us at [email protected]