Last updated on March 11th, 2026 at 03:05 pm
Quick Breakdown
- Vitalik says today’s DAOs are broken and need better governance design.
- He calls for privacy, smarter coordination, and limited AI support.
- Goal: stronger on-chain systems beyond simple token voting.
Ethereum co-founder Vitalik Buterin has renewed his call for better-designed decentralized autonomous organizations (DAOs), arguing that the crypto industry needs to move beyond simple token-holder voting systems toward governance models that can actually solve real coordination problems.
In a recent note shared with the Ethereum community, Buterin said DAOs remain essential to the long-term vision of decentralized systems, but warned that many current implementations fall short of their original purpose. According to him, most DAOs today function as little more than treasuries governed by token-weighted votes.
We need more DAOs – but different and better DAOs.
The original drive to build Ethereum was heavily inspired by decentralized autonomous organizations: systems of code and rules that lived on decentralized networks that could manage resources and direct activity, more…
— vitalik.eth (@VitalikButerin) January 19, 2026
DAOs must go beyond token voting
Buterin emphasized that DAOs are still critical infrastructure for crypto, particularly in areas where centralized solutions introduce trust risks. He pointed to the need for DAOs to support better oracle systems, on-chain dispute resolution, and the maintenance of shared public resources such as security lists, contract registries, and protocol standards.
He also highlighted DAOs as a practical way to fund short-term initiatives and maintain long-running projects after founding teams step away. In these cases, he argued, traditional legal entities are often too slow or rigid, while DAOs can coordinate funding and contributors globally with minimal friction.
However, Buterin stressed that achieving these goals requires new governance designs that are more resilient to manipulation and better aligned with human behaviour.
Privacy, AI, and governance design
A key challenge, according to Buterin, is governance fatigue and social pressure. Without privacy, voting becomes a popularity contest, while frequent decision-making leads to declining participation over time. To address this, he pointed to zero-knowledge technology as a way to preserve privacy, and carefully applied AI tools to help participants process information and reduce cognitive load. He cautioned against fully automated AI governance, arguing instead for systems that enhance human judgment rather than replace it.
Meanwhile, Buterin added that the network’s vision of financial independence cannot be fully realized without stronger decentralized stablecoins that don’t rely heavily on governments, fragile incentives, or weak infrastructure.
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