The diagram above illustrates a multi-tier governance structure involving an expert from some Local DAO, an Expert DAO, and a Technical Infrastructure sub-DAO, leading to the execution of a transaction.

Case example

Implementing a new feature in a DeFi platform

Imagine a DeFi platform governed by a DAO that has several expert sub-DAOs, that operate together to make decisions and implement changes.

Step 1: Local DAO Expert

An expert member of some Local DAO, which represents a specific community, comes up with an innovative idea to introduce a new feature, (e.g. more efficient oracle, which is a part of a DeFi platform technical infrastructure). The expert, after thorough research, conceptualizes the new feature. Then the expert creates a detailed proposal outlining the benefits, technical requirements, and potential risks associated with implementing the new feature.

The Local DAO members discuss the proposal and vote on it. A quorum is reached when enough members vote in favor, signaling a consensus.

Step 2: Expert DAO

The proposal is then escalated to the Expert DAO, — a DAO composed of seasoned experts from various Local DAOs. This DAO has some delegated voting power, indicated by tokens from the Technical Infrastructure sub-DAO, and can vote for some significant decisions.

The Expert DAO reviews the proposal, potentially modifying it with more technical details or risk assessments. After thorough discussion and consideration, the Expert DAO reaches a quorum, indicating agreement on the proposal.

Step 3: Technical Infrastructure sub-DAO

With the approval from the Expert DAO, the proposal moves to the Technical Infrastructure sub-DAO, which is responsible for the technical implementation and maintenance of the DeFi platform.

The sub-DAO members vote, and a quorum is achieved, confirming that the technical aspects are sound and the implementation can proceed.

Step 4: Transaction Execution

Once all the necessary DAOs have reached a consensus, the transaction to implement the new oracle is executed. In the case of a DeFi platform governed by a DAO, this step could also involve smart contract updates, integration of new liquidity pools, adjustments to existing algorithms, etc.

This case exemplifies how a structured, multi-tiered DAO governance system can work together to bring about changes in a DeFi platform, ensuring that decisions are made democratically at various levels of expertise and responsibility.

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