Paper Type
Complete
Paper Number
PACIS2025-1858
Description
Token mechanisms are widely adopted by DAOs to induce users’ contributions. This study investigates the long-term impact of different tokens on users’ behavior from a dynamic perspective. Based on literature, it proposes a classification of token mechanisms into three distinct categories: Currency tokens, Equity tokens, and Debt tokens. A hidden Markov model (HMM) is proposed to characterize user’s latent motivation state. Three latent motivation states (governance participation-focused, balanced, content contribution-focused) are identified. During the state-transition process, the proposed three types of tokens have heterogeneous effects on users within different motivation states. Specifically, Currency tokens show greater influence on users with governance participation-focused state and content contribution-focused state, encouraging greater contributions by providing economic incentives. Equity tokens significantly impact users in the governance participation-focused state and balanced state, by empowering users and providing indirect economic incentives. The findings offer insights for token mechanism design in DAOs.
Recommended Citation
Liu, Zhiyong and Lu, Changjian, "Dynamic Impacts of Token Mechanisms in Decentralized Autonomous Organizations" (2025). PACIS 2025 Proceedings. 5.
https://aisel.aisnet.org/pacis2025/blockchain/blockchain/5
Dynamic Impacts of Token Mechanisms in Decentralized Autonomous Organizations
Token mechanisms are widely adopted by DAOs to induce users’ contributions. This study investigates the long-term impact of different tokens on users’ behavior from a dynamic perspective. Based on literature, it proposes a classification of token mechanisms into three distinct categories: Currency tokens, Equity tokens, and Debt tokens. A hidden Markov model (HMM) is proposed to characterize user’s latent motivation state. Three latent motivation states (governance participation-focused, balanced, content contribution-focused) are identified. During the state-transition process, the proposed three types of tokens have heterogeneous effects on users within different motivation states. Specifically, Currency tokens show greater influence on users with governance participation-focused state and content contribution-focused state, encouraging greater contributions by providing economic incentives. Equity tokens significantly impact users in the governance participation-focused state and balanced state, by empowering users and providing indirect economic incentives. The findings offer insights for token mechanism design in DAOs.
Comments
Blockchain