Multiparty Democracy in Decentralized Autonomous Organization (DAO): Evidence from MakerDAO

Decentralized Autonomous Organization (DAO) provides a decentralized governance solution through blockchain, where decision-making process relies on on-chain voting and follows majority rule. This paper focuses on the most influential DAO, namely MakerDAO, and we find voters fall into different 'voting parties' after applying clustering algorithm to voting history. The significant voting power controlled by voting parties is a signal of governance centralization in DAO, and voting parties have complicated influence on Maker protocol, which is governed by MakerDAO. This paper presents empirical evidence of multiparty democracy in DAO and further contributes to the contemporary debate on whether decentralized governance is possible.