Just as DAOs find more traction in the industry, so too have a series of different tools to measure how decentralized autonomous organizations stack up alongside one another.

Now the question emerges: What makes one DAO better than another?

Sure, you can use the size of their treasury as a metric, but it’s also important that an autonomous organization is also decentralized, something one may crudely measure by determining the number of token holders.

Then there’s voter apathy and the myriad ways one measures how active those token holders actually are.

Even the number of token holders is a splotchy metric. Wallet addresses don’t equal the number of users one for one; oftentimes one user can have multiple wallets, each of which may be holding tokens for the same project.

If one person, with 150 different wallets, holds 60% of a token’s supply across all those wallets, is a project really decentralized?

It’s sort of like measuring the quality of various democracies around the world; it’s super messy and there’s clearly no one right answer.

“Some DAOs maximize for decentralization, trustlessness and transparency. Others will focus on efficiency, with a focus on a sufficient decentralization to avoid capture or control,” Snapshot’s head of growth Nathan van der Heyden told

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Author: Liam J. Kelly

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