🧈 Butter

Butter is a DAO governance system. Its objective is to align DAO governance outcomes to DAO objectives through the direct application of incentives.

This paper describes a prototype, Molten, that attempts to influence DAO stakeholders and governance participants to cooperate using one-off payments.

Summary

One token, one vote mechanisms are the most popular governance mechanisms used by DAOs. However, one token, one vote, and other token voting systems are plutocracies and widely considered vulnerable to corruption and attack.

Large or mature DAOs, and many newer DAOs, have introduced vote delegation to scale governance and alleviate the risks of plutocracy.

However, many recent and well-known examples of plutocracy involve DAOs, including ENS DAO, Sushi DAO, and MakerDAO, in which vote delegation is allowed and often enforced.

We examine the DAO governance problem space and highlight promising in-market solutions, including hybrid governance, metagovernance, and market-based governance.

We propose cryptoeconomics, a system of economic incentives designed to produce behaviors at the micro-scale that create desirable, emergent properties at the macro scale, as a viable solution space for further exploration.

Finally, we describe Molten, a system that aims to address the risks related to plutocracy in DAO Governance using incentives designed to make corruption an unprofitable strategy.