Metaverse Governance: An Empirical Analysis of Voting Within Decentralized Autonomous Organizations

30 Pages Posted: 2 Jan 2023 Last revised: 21 Apr 2023

See all articles by Mitchell Goldberg

Mitchell Goldberg

University of Basel - Center for Innovative Finance

Fabian Schär

Center for Innovative Finance, University of Basel; University of Basel - Economics Department

Date Written: December 23, 2022

Abstract

In this paper we explore the importance of platform governance. We discuss various problems of centralized architecture in the context of the metaverse or sharing economy applications which may lead to monopoly market structures. We argue that open standards and blockchain-based governance can potentially mitigate some of these issues. We then collect governance data from the first blockchain-based virtual world and conduct an empirical analysis to study voter behavior within Decentralized Autonomous Organizations (DAOs). We provide empirical evidence that open standards and blockchain-based governance are a necessary but not a sufficient condition for a decentralized and neutral platform. Centralization and concentrated voting power may lead to dependencies, rent extraction behavior and create hold-up problems. Consequently, producers, prosumers and service providers must evaluate the governance structure of the platform before establishing a presence.

Keywords: Attention Economy, Blockchain, DAO, Governance, Metaverse, Web3

JEL Classification: M37, M38

Suggested Citation

Goldberg, Mitchell and Schär, Fabian, Metaverse Governance: An Empirical Analysis of Voting Within Decentralized Autonomous Organizations (December 23, 2022). Available at SSRN: https://ssrn.com/abstract=4310845 or http://dx.doi.org/10.2139/ssrn.4310845

Mitchell Goldberg (Contact Author)

University of Basel - Center for Innovative Finance ( email )

Basel
Switzerland

Fabian Schär

Center for Innovative Finance, University of Basel ( email )

Basel, 4001
Switzerland

HOME PAGE: http://cif.unibas.ch

University of Basel - Economics Department ( email )

Petersgraben 51
Basel, CH-4003
Switzerland

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
233
Abstract Views
899
Rank
244,023
PlumX Metrics