Definition ∞ A Dao Governance Mechanism is the system through which a Decentralized Autonomous Organization makes collective decisions, typically involving token holders voting on proposals. This structure enables a distributed and transparent method of control over a protocol or project. It replaces traditional hierarchical management with a community-driven decision-making process.
Context ∞ The effectiveness and fairness of DAO governance mechanisms are frequent subjects in crypto news, particularly concerning protocol upgrades, treasury management, and conflict resolution. Debates often address voter apathy, the concentration of voting power, and the technical challenges of implementing secure and efficient voting systems. The evolution of these mechanisms is critical for the long-term viability of decentralized projects.
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