On-chain nominations: a solution to social-layer power centralization

How would you place this DAO on the centralized-decentralized spectrum? In the discussion surrounding the constitution the topic of decentralization within the DAO arose. It seems to me that power on the social governance layer within the Bankless DAO is currently highly centralized, and power on the computational governance layer is less centralized.

A meritocratic contribution-based distribution of power is happening on the social layer and is being coordinated by founders and a core group, with status and positions being granted to those who show initiative or produce results that are noticed through a nomination process. Most of the discussion around power distribution seems to be happening around token distribution.

Interestingly, it seems that the power at the social layer may have much more overall impact on DAO governance than token distribution. BANK token distribution will allow big holders to exert power on the DAO when proposals are voted on, but the social layer determines which proposals are actually put up for a vote. The emergent selection pressure we see at the social layer will shape the real power distribution within the Bankless DAO. There is currently a brief period in which power is flowing down to those with qualities desirable to the founders and core team, and then the granted positions, status, and the restriction on communication in discord channels based on assigned level will solidify this power. This is useful, as social layer status can be used to incentivize the creation of Bankless media even after initial BANK token distribution is finalized.

On the social layer, those in the inner circles at the highest levels will eventually be disincentivized to make nominations and dilute their status. Great examples of this in the rapid consolidation of power in former USSR countries. I wonder if we will reach a point where this stratified power distribution will be seen as hindering the overall success of the Bankless DAO at achieving its mission, and what solutions might arise. It might be possible to even use the computational governance layer to decentralize some of this social layer power over time by holding nomination processes on chain and incentivizing the spread of power with tokens. This could become a proposal, but it is likely too early at this point since this has not become an actual problem yet.

In the early days of Ethereum Vitalik threaded the needle masterfully as a founder who needed to decentralize social layer power for the overall success of the project. It will be interesting to see what happens with social-layer power in the Bankless DAO over time. What an amazing experiment!


By the time it becomes a problem it will be too late. At a minimum, there needs to be a capability for anyone above a certain holding level to initiate a snapshot proposal for the rare cases when it’s clear there is general consensus, but no backing from the social layer.

Realistically though, what will happen if the stakeholding consensus differs from the social layer perspective is that members will opt to quit by selling their stake and moving on. Depending on whether the social layer is ‘right’ in their strategic direction, this could be a significant detriment to the viability of the DAO.


In another post I wondered what makes a DAO a DAO. Now I believe no one should have more vote weighted power that others just because they have more BANK. One person, one vote equally weighted. If people with more BANK has more voting power this opens the doors to corruption and there is the risk of any entity outside the DAO to eventually take over the DAO.
In addition to this, the DAO is for everyone that share the same mission, the mission is set up by the DAO, and the DAO is the sum of all its members.


I agree fully. I am hyperaware of the size of this “core” social circle.
There are a few ideas I’ve been juggling on how to do this. Quick dump:

  • “core” members are elected every season
  • Level 2 members are nominated by other level 2s and must past some vote consensus
  • “teams” that are being given generous resource allocations must have KPIs and OKRs and be held accountable to other members of the DAO.

The amazing thing about this being on-chain is that we have so many new options for countering power centralization and stagnation. I’m not suggesting we do this, but imagine if we were to use the chain to assign positions, but burn some of the tokens of that person for each day they are in the position! This would create a real-world “cost” to holding a position and would likely make people budget carefully and use time holding that position to accomplish things very efficiently. The position could be vacant when it’s not being used to avoid stagnation.

These are just ideas, I’m blown away at how many options we have at our fingertips here.


The media node protocol folks having some interesting ideas on staking to join the banklessdao media network. Talk to @wolfehr if you’re interested in learning more

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That requires identity to prevent sybil attacks, which there is currently not a solution for

Since we are adopting a Soviet model of governance, I would like to make a proposition that all members of the Bankless DAO before they speak address each other by a term “Comrade”.


Please continue to post and critique. I think this is an excellent contribution for us to be aware of.

I’ve noticed something to this to that… are these popularity contests, with those that have the best rhetoric winning out?

Some parts of this may be the inherent nature of what being a DAO is with humans who are social animals, although it seems like we are finding out.


Wow this is mind blogging… very interesting concept. But yeah it’s something that can be considered. Productivity and efficiency could skyrocket.


Not sure about that term.

Thanks! I’ve been having a lot of fun with this.

There are some problems I’ve seen in nearly all the orgs I’ve been a part of. I’m sure all of us have seen these things. Often the people who are most attracted to status or power positions are not suited to do well in these positions.

I’m not saying that none of the high status people in this DAO currently should have that status. Definitely not. There’s lots of motivation, relevant experience, and great work going on. But we should recognize that there are well qualified people lurking in the DAO. How do we push power down to them? If we claim to value decentralization this should be a priority.

Legitimacy by continuity is scarce. By allowing power to consolidate early through the assignment of status, access, and positions in this fast-paced, visible contribution rewarding manner we are selecting for certain qualities. Are these qualities we, the DAO, want to select for? Another way to ask this: is what rises to the top the cream or the dross?

On-chain governance allows us to control organizational selection pressure in truly new ways. Innovating with these new tools will help us succeed and will help future DAOs, and may have broader world impact than any of us could imagine.

The same blockchain tech that brought us Money Legos in finance unlocks Behavior Coordination Legos. This new tech will revolutionize the way humans organize themselves. We’re on the bleeding edge.


I couldn’t agree more with you. I think we have the opportunity here of distancing ourselves from the power grabbing dynamics. This will sort so many problems imbedded in our society that I don’t want to emulate in the DAO. After all, the DAO has a mission, so let’s not get distracted. Let’s work for that common goal and let’s leave personal wars and aspirations aside.

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This seems relevant to the discussions at hand. Could we leave it for a while?

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