DAO and tokenized governance: the problem of decentralized decision-making

Abstract

This chapter analyses how the tokenization of decisional power – enabled by blockchainbased governance tokens – offers new governance models while simultaneously revealing structural, technological, and legal limits. After illustrating how electronic voting and tokenbased identification address challenges such as deepfakes, the chapter examines the functioning of DAOs, their governance procedures, and the informal community dynamics that shape decision-making. It then discusses the conceptual difficulties surrounding ‘decentralization,’ reviews existing metrics, and proposes alternative normative criteria, including minimum independent decision centres and the ‘mutualistic symbiosis’ between protocol, users, and developers. The final section evaluates legal obstacles under Italian law, showing the limited feasibility of tokenizing corporate participations and the centralizing effects introduced by the Fintech Decree. The chapter concludes that regulators must develop a coherent legal definition of decentralization and simplify regulatory frameworks for tokenized equity instruments. Keywords: Decentralized Autonomous Organizations (DAOs), tokenized governance, decentralization metrics, Blockchain-based voting, CorpTech regulation, Fintech Decree (Italy).