state of crypto governance

DAOs after token governance: Where governance goes when capital stops leading?

Humanode Core

17 Nov 2025 • 19 min read

Token governance was supposed to give us a new way to decide together. After years of watching it in practice, the picture is clearer: most people don’t vote, power settles where capital settles, and the real decisions often fall back to the same groups who understand the code, run the infra, or hold the keys. It isn’t failure, its gravity. Systems built on capital tend to answer to capital.

But blockchains no longer live as weekend experiments. They’re turning into public infrastructure, used by people who will never join governance calls or read forum threads. And once you accept that, you start asking different questions. What makes a decision legitimate when money isn’t the measure? How do you distribute responsibility without drifting into bureaucracy or technocracy? How do you give every person a voice without making the system impossible to steer?

The answers emerging across the ecosystem point in the same direction: identity, contribution, and layered authority. Vortex sits inside that shift, a model built on one human, one vote, and a cognitocratic layer that recognizes those who actually carry the work. Proto-Vortex is the small experiment running ahead of it, testing how humans behave before any of this becomes law on-chain.

The next era of governance won’t be about who owns the most. It will be about who shows up, who contributes, and how we build systems that honor both.

1. The shift beyond token governance

1.1 Looking back at the 2024 report

When we published the State of Crypto Governance in 2024, the field still felt suspended between theory and practice. Most Layer-1s had governance processes, but few had the data to show how those systems behaved over time. We mapped out how decisions flowed through Bitcoin, Ethereum, Tezos, Polkadot, Cosmos, and Dash, and we tried to understand the incentives, the social structures, and the power dynamics behind them. At the time, the landscape was still young enough that almost everything could be justified with “it’s early.”

A year isn’t much on a human timescale, but blockchains don’t move on human time. They ship proposals, delegate votes, pass upgrades, reject others, survive crises, and accumulate histories. Since 2024, we’ve seen enough proposals, enough participation curves, enough drama, and enough quiet failures to drop the theoretical mask and look at the systems as they are. More case studies. More data. More debates. And fewer excuses.

The truth that’s emerged isn’t shocking, just clearer.

1.2 Token governance didn’t fail. It plateaued.

Token voting didn’t melt down. It didn’t vanish. It simply reached its natural boundary. It works fine for small treasuries and routine decisions, but struggles when a protocol becomes real infrastructure. Turnout settles into a predictable trough. Voting power sinks into predictable corners. And “community governance” often means a few technically-informed actors shaping the path while most token holders drift into the background.

Token governance didn’t collapse. It just stopped climbing.

1.4 So the question in 2025 is simple:

What comes after token governance?

If the goal is to build systems that will still matter in 5, 10, 20 years, systems used by millions of people who may never buy a governance token, then the foundation has to be something sturdier than capital weight.

And that question has now become impossible to ignore.

1.5 The scope of this article

This article picks up where the 2024 report left off, but with the benefit of hindsight and real-world evidence. Here’s what we’ll do:

Look at what token governance actually produced in the wild, not what it promised.
Explore the new governance patterns that emerged across 2024–2025 identity-aware models, polycentric structures, and contribution-based systems.
Position Vortex as one of the new models responding to those limits, grounded in one-human-one-vote and cognitocracy.

This is not an argument against token governance. It’s an argument that the field is moving on, and the next phase will look very different from the first.

2. The reality check: what a decade of token governance taught us

Token governance didn’t arrive with DeFi. It has roots in the 2016 DAO, token-curated registries, early governance tokens, and the first generation of treasury DAOs. After nearly a decade of experiments, we have enough data and lived experience to judge the model on its behavior, not its intentions.

The evidence paints a consistent picture: token voting is predictable, stable, and deeply constrained by its own design. Understanding those constraints is the first step to understanding why the industry is now searching for what comes after it.

2.1 Participation data: who actually votes?

If you look at the raw numbers across major DAOs, from 2023 through 2025, two things stand out:

1. Participation is low

Despite millions of token holders across the ecosystem, average voter turnout hovers between 17% and 25% on meaningful proposals. Some DAOs dip much lower. Participation spikes during crises, then drops back to baseline.

This isn’t community apathy, it’s structural. Token voting creates a world where:

most holders see no direct impact from decisions,
voting has no immediate personal payoff, and
the cognitive cost of “staying informed” is high.

Low turnout is not a bug. It’s a natural equilibrium.

2. Delegates dominate decision-making

Even in systems with delegation, the pattern is consistent:

A small group of delegates handles most of the votes.
Delegation flows cluster around a handful of recognizable names.
Delegate “monopolies” form unintentionally, simply because most holders want someone else to handle the workload.

Millions of token holders do not translate into millions of decision-makers. The system doesn’t push people into governance rather pushes them out.

2.2 Concentration: voting power belongs to the top 10–20%

Token-weighted governance reflects the distribution of tokens. And token distribution, across almost every protocol, is heavily skewed.

In practical terms:

10–20% of the top holders often control 60–90% of the voting power.
Treasury decisions, parameter changes, and protocol updates overwhelmingly pass (or fail) based on the preferences of large holders.
Delegation tends to magnify, not reduce, existing concentration.

Case studies reinforce this:

Uniswap: A few addresses can swing almost any major vote.
Aave: Voting influence clusters tightly around early, large holders and funds.
MakerDAO: Real decision-making migrated from broad token holders to a small set of recognized delegates and Domain Teams.
Lido: Governance proposals increasingly hinge on a tiny fraction of LDO supply.

None of this represents malicious behavior. It’s simply what happens when capital equals voice.

2.3 Technocracy disguised as decentralization

Token governance was sold as a democratized alternative to traditional systems. In reality, most decisions are shaped by small groups long before any vote opens.

Across major protocols, real influence consistently flows through:

core developers, who understand the codebase and manage implementation,
foundation teams, who coordinate roadmaps and define priorities,
large stakeholders, who decide which proposals are politically feasible,
dominant delegates, who act as de facto representatives.

Token voting often plays the role of a rubber stamp on decisions that were already debated, shaped, or negotiated off-chain in working groups, Discord channels, or private calls.

The academic term for this is governance theater. A formal process exists, but the real power sits with those who have context, continuity, and technical fluency.

Again, the point is not failure, only structure. Token governance naturally evolves toward technocracy because understanding complex protocols is a specialized task.

2.4 Governance as digital commons, not corporate boards

The biggest misinterpretation in early DAO designs was the idea that governance would resemble shareholder voting. But blockchains don’t behave like corporations. They behave like digital commons:

shared infrastructure,
overlapping stakeholder groups,
long-term stewardship problems,
and no single actor who “owns” the system.

Commons theory (Ostrom and successors) shows that healthy shared systems require:

layered authority,
multiple centers of decision-making,
role differentiation,
clear accountability,
and legitimacy rooted in participation rather than capital.

Token voting is a one-dimensional tool for a multi-dimensional environment. It’s not wrong, just insufficient.

Blockchain ecosystems need governance that deals with:

technical upgrades,
economic incentives,
security risks,
regulatory pressures,
community norms,
and cross-chain dependencies.

A simple “1 token = 1 vote” mechanism cannot capture that complexity.

2.5 Summary: token voting is not broken, it’s just limited

Token governance works better than many alternatives. It’s transparent, predictable, and easy to execute. It’s perfectly reasonable for:

treasury allocations,
minor upgrades,
community initiatives,
and small-scale DAOs.

But once a protocol becomes public infrastructure, something people build businesses on, something regulators look at, something with real economic weight, the weaknesses become obvious:

low participation,
power concentration,
technocratic bottlenecks,
coordination failures,
legitimacy gaps,
identity issues,
lack of accountability.

Token voting served its role. It helped DAOs get off the ground. But as the stakes rise, the field is already moving toward something broader: identity-aware, contribution-based, and polycentric governance systems.

These limits didn’t appear suddenly. They revealed themselves in slow, consistent patterns across every major DAO. And as those patterns became clearer, protocols began to experiment, not with tweaks to the voting UI, but with entirely new models. The result is the governance landscape of 2024–2025, where projects across the ecosystem are quietly rewriting the rules of how decisions are made.

3. The new governance landscape

In the wake of the first wave of governance experiments, the period from 2024 into 2025 marks a clear transition. Rather than simply refining token-weighted governance, several networks and DAOs are actively re-engineering how decisions are made, who holds authority, and how legitimacy is constructed. This section surveys three key vectors of change: the emergence of structured on-chain governance, the rise of dual or multi-house governance models, and the increasing focus on identity-aware and contribution-based systems.

3.1 Structured on-chain governance emerges

One of the more visible shifts in Layer 1 ecosystems is the migration from loose governance frameworks to formalised on-chain constitutions, representative bodies, and procedural guardrails. For example, Cardano formally progressed toward a community-ratified constitution and introduced Delegated Representatives (DReps) to participate in governance alongside Stake Pool Operators and a Constitutional Committee.

Similarly, projects such as Polkadot have iterated their on-chain governance (from OpenGov to newer models) to incorporate referenda, councils, and formally encoded proposals. Even in ecosystems previously reliant on off-chain forums, there is now an increasing push toward embedding governance into the protocol layer itself, votes, upgrades, treasuries, and community bodies.

This shift matters because governance is no longer incidental: it is being treated as infrastructure. By codifying roles, rules, and thresholds, the hope is to reduce ambiguity, increase transparency, and make governance less ad-hoc. However, this also means governance models become less flexible, more formalised, and potentially more brittle if the underlying community doesn’t adapt.

3.2 Dual and multi-house governance models

Another hallmark of the governance frontier in 2024–2025 is the emergence of multi-house or dual governance architectures, systems that intentionally separate, and sometimes check, different stakeholder interests. A prominent example is Lido DAO, where staked-ETH holders (via stETH) and token holders (via LDO) are given distinct, overlapping governance rights. In its dual-governance model, stETH holders acquire veto or delay powers over certain decisions made by LDO token-holders; the more stakers signal opposition, the longer the timelock before execution, or in extreme cases, a “rage quit” mode is triggered.

Beyond Lido, other governance systems are experimenting with a “Token House + Citizens’ House” structure: token-holders vote on protocol parameter or upgrade issues, while contributors/users or stakers vote on treasury, usage, or social-contract issues. This polycentric design accepts that a single governance house is unlikely to manage all domains properly. The logic: infrastructure decisions (protocol rules) require one expertise set, while community/funding decisions need another. By creating separate houses or roles, these models aim to balance power, avoid single-stakeholder capture, and embed checks between domains.

The movement toward multi-house governance signals that many protocols are no longer satisfied with “one token = one vote” as the entire governance model. They are recognising that decision-domains differ and that authority should reflect those differences.

3.3 Identity-aware and Sybil-resistant voting

A third and perhaps more radical trend is the push toward identity-aware governance, moving from “wallets with tokens” toward “humans as decision-makers.” The impetus is clear: token voting systems struggle with Sybil risk, capital concentration, and legitimacy concerns. Several academic and technical studies highlight that digital commons and DAOs must embed human-centric identity and contribution layers to avoid devolving into oligarchies.

On this front, Proof-of-Personhood (PoP) protocols and decentralized identity systems (DIDs) are being referenced as part of the toolkit. For instance, the concept of PoP, where each unique human receives one unit of voting power or one node in the consensus, re-appears in blockchain research as a means to move toward “one-human-one-vote.”

Practically speaking, this means experiments with biometric uniqueness, offline/online identity fairs, and token-less voting rights. It also means questioning the assumption that capital should be the main axis of voting power. Privacy remains a major challenge: how to verify uniqueness without exposing identity, how to allow exit/entry, how to design globally fair processes, and how to avoid new centralised identity providers. Still, the very conversation marks an important shift.

3.4 Contribution-based governance experiments

Complementing identity-aware models are contribution-based governance architectures. Instead of defaulting to “stake-equals-vote,” these designs weight governance rights, or opportunities to propose and execute, based on historical contribution: code commits, community work, proposals delivered, audit participation, treasury oversight. Research on reputation- and contribution-based systems in DAOs notes that reputation modules, hybrid token-reputation layers, and “builders’ houses” are increasingly common.

In practice, this means DAOs may allow anyone to hold basic voting rights, but only experienced contributors (or governors) can trigger major proposals, allocate large treasuries, or act as agenda-setters. The result: a separation between who votes and who frames and executes. This design reflects the reality that not all token-holders have context, skills or long-term commitment, and channels governance authority toward the people who do.

3.5 The pattern is clear: humans, not wallets

What emerges from all of the above is a clear pattern: governance in crypto is migrating from a single dimension of token-weighted voting toward a multidimensional architecture. The key themes are:

Humans instead of wallets: emphasis on personhood and unique participation, not just token wealth.
Contribution instead of capital: influence increasingly tied to what you do, not just what you hold.
Multi-layer systems instead of one flat house: token-holders, stakers, contributors, citizens, each have functional roles.
Accountability instead of technocratic ambiguity: defined roles, processes, and checks aim to curb hidden concentration of power.

In short, the next wave of governance is not about building bigger token-voting machines; it’s about designing governance machines built for people.

What emerges from these experiments is a shift: from wallets to humans, from capital to contribution, from single-house voting to multi-layer authority. Humanode’s Vortex model didn’t appear in isolation; it emerged in response to the same pressures shaping the rest of the industry. But because Humanode begins with proof of biometric uniqueness (PoBU) at its foundation, Vortex is able to take these ideas further than most networks can.

4. Vortex: a new governance model for human-based networks

4.1 Why Humanode needed something beyond tokens

In designing the HMND ecosystem and the Humanode network, the team recognized early that simply plugging a token-vote model into a system anchored in “one human = one node” would sidestep the core promise. Traditional blockchains tie power to capital, either mining hardware or staked tokens. But Humanode’s architecture is built on a radically different premise: each node corresponds to a verified, unique human being through cryptobiometric proof.

That premise forces a different governance question: if each human node is equally valid, then how should voting and decision making be structured? Token governance treats vote weight as a function of wealth; Vortex treats vote weight as equal, but distinguishes agenda-setting, proposal rights, and decision responsibility based on contribution. The whitepaper lays this out clearly: Vortex “establishes a cognitocratic framework where decision-making is decoupled from capital and aligned with Proof-of-Time (PoT), Proof-of-Devotion (PoD), and Proof-of-Governance (PoG).”

4.2 The design philosophy behind Vortex

Vortex rests on four interlocking design pillars:

Equal voting power: Every human node gets one vote, regardless of wealth or stake. This aligns with the Humanode base rule: one human = one node = one vote.
Contribution-based responsibility: While voting is equal, not all participants have the same role in proposing or steering high-stakes decisions. That role is earned via PoT (time active), PoD (demonstrated contributions), PoG (participation in governance).
Specialization Chambers: Vortex organizes governance by domain. Each chamber handles a focus area (technical upgrades, treasury policy, community & social, ecosystem growth). This reflects the insight that governance isn’t one kind of thing, it’s many.
Proposal Pool + Dynamic Metrics: Vortex uses a proposal-pool architecture where ideas are ranked, filtered, and only good proposals reach the full vote. A participant’s “Cognitocratic Measure (CM) Score” adjusts dynamically based on behaviour, proposal quality, chamber feedback, and historical vote engagement.

This philosophy moves governance away from “who has the biggest bag” toward “who shows up, who contributes, who has earned responsibility.” It treats governance as an ecosystem of roles, not as a pure marketplace of votes.

4.3 What makes Vortex distinct from prior models

Several features mark Vortex as a genuinely distinct governance model:

Decoupling power from capital: Traditional token DAOs give voice proportional to stake; Vortex gives voice equal but responsibility graded by contribution.
Contribution, not accumulation: The key metric is not how many tokens you hold, but how you participate over time.
Poly-layer governance built in: Many token models add councils later; Vortex puts specialization and layered authority into the design from day one.
Sybil-resistance rooted in human identity: Because each node must belong to a unique human verified biometrically, the classic “buy a million addresses to dominate governance” attack is structurally harder. Humanode’s biometric foundation enables this.
Dynamic governance, not static token snapshot: The proposal pool, attention quorum, CM Score and tier systems enable continuous adjustment, which helps governance evolve rather than freeze at some “v1”.

Of course, this isn’t perfect or final. Vortex is still under development, and its real test will be in deployment, scaling, voter behaviour, and the resistance to abuse under real-world conditions.

5. Proto-vortex: the experimental loop before the real dao

Before any governance system is written into code, it needs to survive contact with real people. Most DAOs skip that step. They jump straight from a forum post to a governance module, hoping the structure will somehow align with how humans actually behave. Humanode took the opposite approach. Proto-Vortex was built not as a DAO, not as a governance layer, and not as a final model, but as a test environment to observe what people actually do when you hand them voice, responsibility, and incentives.

Proto-Vortex lives entirely off-chain. No smart contracts, no automated execution, no locked-in rules. It’s a social experiment framed around the core principles of Vortex: human-based voting, contribution-based influence, and specialization. The goal is simple: collect evidence before enshrining anything into the protocol. It tests how humans propose ideas, how they negotiate tradeoffs, how they over- or under-coordinate, and how attention behaves when decisions repeat every two weeks. It’s a governance laboratory, not a governance solution.

Every two-week cycle, a funding pool is opened, proposals are submitted, evaluated, debated, and voted on by active human nodes. The rules are intentionally minimal. Participants aren’t voting with tokens, they’re voting because they care, or because they want something built, or because they believe their idea deserves a shot. Winning proposals receive budget and guidance from the Humanode core team, but the more important outcome is informational: which ideas get traction, which incentives work, which don’t, and which governance behaviors repeat across cycles.

Proto-Vortex exists to answer questions that no whitepaper or theoretical model can resolve. Will people propose things consistently? Will proposals cluster around certain types of contributors? Will most participants show up every cycle, or will a reliable minority emerge? Will voters prefer high-impact technical proposals, or community growth, or operational improvements? How do people respond when a cycle fails and the budget rolls over? How quickly does governance fatigue appear? And perhaps most importantly: how do these social patterns map onto the formal chambers and responsibility tiers envisioned in the Vortex design?

By keeping Proto-Vortex off-chain and fully reversible, Humanode is able to refine the assumptions behind the Vortex governance framework without risking a hard-coded system that later needs to be patched or politically re-designed. It is a deliberate pause, a recognition that the governance problems of crypto are not technical puzzles but human ones. If Vortex is the destination, Proto-Vortex is the mapmaking phase.

Over the coming months, the data, behaviors, and pain points observed in Proto-Vortex will feed directly into the coded version of Vortex. Not by replicating the experiment as-is, but by learning from its patterns: how humans make decisions, how they allocate trust, and how they respond when governance becomes a shared responsibility instead of a spectator activity. Proto-Vortex is teaching us that governance can’t be designed only at a protocol level, it has to be shaped in dialogue with the people who will use it.

Proto-Vortex is not a DAO. It is not governance. It is governance research, a living test bed for the system that will eventually secure the network. And that distinction is what makes it necessary.

6. Where Vortex fits in the new governance landscape

As governance models across crypto evolve, certain patterns have become clearer. Networks are no longer satisfied with flat token voting or loosely defined community forums. Instead, they are moving toward layered systems, identity-aware structures, contributor weighting, and multi-house authority. When placed against this backdrop, Vortex does not appear as an outlier, it appears as the logical extension of where the field is already heading.

Most structured Layer-1 governance models, such as Cardano’s DReps or Polkadot’s OpenGov revisions, focus on embedding formal roles into the protocol: representatives, committees, constitutional bodies, and escalation mechanics. These systems assume that governance must be predictable, rule-bound, and enforceable by code.

Vortex aligns with that direction in its use of chambers, role differentiation, and a defined proposal lifecycle. But it also diverges: instead of tying authority to capital or delegation size, Vortex ties it to the contribution history of a unique human. Where other protocols rely on token-derived legitimacy, Vortex roots legitimacy in human identity and proof of involvement.

Dual- and multi-house governance systems, like Lido’s dual governance or the “token house + citizens’ house” designs appearing in newer DAOs, reflect the emerging belief that a single governance layer cannot represent all stakeholder interests.

Vortex shares this polycentric philosophy but applies it differently. Instead of creating separate houses for different token constituencies, Vortex creates chambers tied to functional expertise. Decision-making becomes distributed along knowledge domains, not token types. In that sense, Vortex behaves more like a professionalized commons model than a corporate governance replica.

Identity-aware governance is another area where Vortex aligns with broader movements. Throughout 2024–2025, many protocols experimented with Sybil-resistant or semi-personhood voting systems, ranging from off-chain identity proofs to decentralized identifiers.

Vortex pushes this trend further by anchoring every voice to a verified human node. It doesn’t just use identity as an add-on; identity is the base layer. The governance system assumes human uniqueness as a protocol primitive, not an optional tool. That places Vortex closer to the “post-token governance” direction emerging in certain research circles, where identity rather than capital becomes the starting point of legitimacy.

Contribution-based models are also gaining traction, systems where influence grows with proven work, not accumulated wealth. Vortex directly incorporates this through Proof-of-Time, Proof-of-Devotion, and Proof-of-Governance. Most DAOs that experiment with contribution weighting do so by adding extra reputation layers on top of token voting. Vortex inverts that structure: contribution forms the core, and voting is the equal layer shared by all humans. Instead of merging reputation with stake, Vortex separates them so each governs a different part of the process. The design reflects a broader shift toward professionalized stewardship and away from crowd-sourced decision fatigue.

Taken together, Vortex fits neatly into the arc of governance evolution but advances it in a direction few protocols can realistically follow. Most networks cannot adopt one-human-one-vote without an identity layer. Most cannot implement contribution-based authority without a proven system to track human participation. And most cannot reduce token influence without upsetting the economic base that secures the network. Humanode’s architecture allows Vortex to exist because the consensus mechanism already rests on biometric uniqueness; governance can therefore treat humans, not wallets, as the fundamental unit.

The comparative view makes one thing clear: Vortex is not a deviation from governance trends. It is governance following its trajectory to a logical end. Where others build multi-house systems, Vortex builds chambers. Where others add identity enhancements, Vortex makes identity foundational. Where others experiment with reputation overlays, Vortex makes contribution the structure that shapes responsibility. And where token-weighted governance continues to dominate by inertia, Vortex offers a model built for networks where capital is not the measure of legitimacy.

In an ecosystem searching for alternatives to plutocratic voting, Vortex sits as one of the first fully realized attempts to design governance around humans, expertise, and responsibility rather than balances and snapshots. It is not the only direction governance is evolving toward, but it represents one of the clearest expressions of what “after token governance” can look like.

7. Why post-token governance matters now

Token governance worked when protocols were small, experimental, and mostly speaking to their own token holders. But by 2025, blockchains are no longer side projects. They are settling billions in value, powering entire ecosystems, and supporting communities far larger than the people who show up to vote. When a network becomes public infrastructure, the way it is governed has to match that reality. Token voting, with its low turnout, concentrated power, and dependence on a few technically informed actors, starts to feel less like decentralization and more like an inherited constraint.

The pressure isn’t only internal. As protocols become real economic infrastructure, the outside world demands clearer accountability. “The biggest wallets said so” is no longer a credible answer when a change affects millions of users or businesses, depending on a chain’s stability. And inside crypto, the culture has shifted as well. People increasingly recognize that decentralization isn’t something you declare; it’s something you prove through processes that distribute responsibility rather than concentrate it. Wallets aren’t humans. Wealth isn’t commitment. A governance system that treats them as such will always have a legitimacy ceiling.

This is why post-token governance matters. As networks scale, they need systems that reflect how people actually participate: through identity, contribution, and long-term involvement. They need layered authority instead of one flat house, clear roles instead of technocratic drift, and decision-making that grows with the network rather than bottlenecks it. In other words, they need governance that looks less like a corporate shareholder vote and more like the stewardship of a digital commons.

Vortex sits inside that shift. It takes the direction the ecosystem is already moving toward, identity-aware voting, contribution-based responsibility, and polycentric decision structures, and pushes it to its logical end. For Humanode, which is built on one-human-one-node at the consensus level, tying governance to humans is not an add-on. It is the only coherent path. And in a world where blockchains are becoming long-lived public systems, models that put humans and contribution at the center aren’t just interesting, they’re necessary.

Disclaimer: This article was researched and written by the author, but LLMs were used to organize, structure, and draft. The research, arguments, and conclusions are the author’s own.