The world of decentralized autonomous organizations (DAOs) is a rapidly evolving landscape, characterized by innovation, experimentation, and adaptation. In this article, we will delve into the unique approaches to governance employed by two prominent DAOs, Maker DAO and Nouns DAO, shedding light on their distinct structures, values, and contributions to the blockchain space.
While exploring these innovative entities, it is important to note that DAOs are continually changing, driven by community participation and discussions, and the active involvement of stakeholders in shaping their future. Recently, the Shimmer has shed more light on Maker DAO and Nouns DAO, highlighting the features of the earliest and the latest incarnation of DAO.
Maker DAO: Empowering the Community
Maker DAO, one of the oldest DAOs in the blockchain ecosystem, operates under the governance of its native token, MKR. MKR token holders play a pivotal role in decision-making processes that include setting policies for the DAI stablecoin, selecting new collateral types, and enhancing governance itself. Unlike traditional governance models, Maker DAO is open to all, with a commitment to inclusivity and community-driven decisions.
The journey of Maker DAO began as a foundation, aiming to empower its community with governance responsibilities. Eventually, the foundation dissolved, giving rise to a decentralized, community-driven Maker DAO. Today, this DAO stands as a testament to its success, boasting one of the highest Total Value Locked (TVL) in the ecosystem.
Maker DAO’s governance decisions are executed transparently on-chain, with token holders voting on each proposal. To further streamline the process, token holders have the option to delegate their voting power to individuals who dedicate themselves to enhancing the protocol. This tiered system within the governance structure ensures informed and less exploitable decision-making, reinforcing the delegation system.
Nouns DAO: The Vision-First Approach
Nouns DAO represents a more recent addition to the DAO landscape. This DAO employs a governance structure based on a fork of the Compound governance model and is the primary governing body of the Nouns ecosystem. What distinguishes Nouns DAO is its reliance on Noun NFTs for governance, a departure from conventional token-based systems.
The Noun DAO treasury accumulates 100% of ETH proceeds from daily Noun NFT auctions. Each Noun NFT is inherently tied to the DAO, entitling its holder to one vote in governance matters. These votes are unique in that they are non-transferable but can be delegated, fostering a sense of responsibility among Noun NFT owners.
Nouns DAO’s growth strategy is characterized by gradual and linear expansion. By offering one Noun NFT per day, the community can steadily welcome new members into the governance structure, fostering better cohesion and a stronger sense of community. This approach allows the founders to pass on their vision and mindset to a limited number of newcomers each day, ensuring the preservation of the DAO’s culture.
Different Paths, Shared Evolution
While Maker DAO and Nouns DAO have distinctive governance models, they both contribute to the evolution of DAOs as a whole. Maker DAO emphasizes on-chain decision-making and inclusivity, while Nouns DAO champions a vision-first approach that values alignment with the overarching purpose of the DAO over strict structure.
In the ever-evolving world of DAOs, learning from the successes and failures of others is paramount. Regardless of the specific governance model, active community involvement through discussions and proposals is a common theme. Engaging in these discussions not only strengthens an individual’s position within the community but also ensures that their voice is heard and actively contributes to the improvement of the protocol.
As the DAO ecosystem continues to mature, these two exemplars – Maker DAO and Nouns DAO – showcase the diversification of governance approaches. While they may take different routes, their shared commitment to progress and innovation underscores the profound impact that DAOs are making on the blockchain landscape.