Opinion: Francesco Mosterts, co-founder of Umia.

Crypto prides itself on being a market-oriented system. Prices, incentives, and capital flows determine everything from token valuations to lending rates and demand for blockchain space. Markets are the main coordination mechanism in the industry. However, when it comes to governance, cryptocurrencies are suddenly abandoning the markets altogether.

Recent governance disputes within core protocols have once again exposed tensions within DAO decision-making. Participation remains extremely low and influence highly concentrated. AND test of 50 DAOs found a “clear pattern of low-token holder engagement,” showing that a single gigantic voter can influence 35% of outcomes, and four or fewer voters influence two-thirds of governance decisions.

This is not the decentralized cryptocurrency of the future that was originally intended to be built. An early vision for the industry was to remove concentrated power and replace it with systems that distribute influence more equitably. Instead, DAO governance often leaves most token holders passive while a compact group determines the direction of the protocol.

Token voting was the first attempt at decentralized cryptocurrency management. This is a broken incentive system and it needs to be changed.

The promise of symbolic management

The original “DAO” was launched in 2016 as a decentralized venture capital fund in which token holders voted on which projects to fund. The earliest DAOs were inspired by the idea that organizations could operate solely through code.

In the concept of cryptocurrencies, voting for tokens seemed intuitive. They borrowed from familiar concepts such as shareholder voting, but DAOs promised a recent form of governance called “decentralized governance.” The tokens would represent both ownership and decision-making, meaning anyone who holds them could participate in shaping the direction of the protocol.

Related: ‘Raider investors are plundering the DAO

Token voting was intended to solve problems across many industries, including centralized control, unclear decision-making, and disconnects between teams and users. It offered a straightforward promise: if the community owned the token, they would manage the project. In practice, however, this miraculous solution did not live up to expectations.

The reality of why token voting fails

Token voting has three main problems: participation, whales, and incentives.

Participation is obvious: most token holders do not vote. With a lot of material to go through, especially when many management decisions should be taken, the real problem is management fatigue. The result of what we see every day in crypto now is that the majority of token holders are ultimately passive, with outcomes determined by a compact minority.

When it comes to whales, it’s obvious that they are substantial holders dominant. This is demoralizing for ordinary voters who feel that their opinions do not matter, even though the original promise of the DAO was that they would have a real vote. What’s the point of voting if whales have the final say?

Finally, there is the problem of motivation. The vote carries no economic signal. Votes carry the same weight whether you are informed or not. There is no cost to being wrong and no incentive to be right. There is nothing to motivate participants to seek information and vote according to their beliefs.

Realistically, under the current government, voting simply expresses opinions. It does not express conviction.

The missing piece is pricing decisions

Crypto is fundamentally market driven and performs exceptionally well. Markets aggregate information, price risk, and reveal belief in ways that few other systems can. The industry has built markets for virtually everything, including tokens, derivatives, blockchain, and interest rates. They form the basis of how cryptocurrencies coordinate economic activity. However, when it comes to governance, the system suddenly abandons markets altogether.

Decision markets bring prices into management. Instead of simply voting on proposals, participants exchange results, evaluate possible decisions and support their views with capital. This transforms management from a system of expressed preferences to a system based on measurable beliefs.

By tying decisions to economic incentives, participants are encouraged to examine propositions and think carefully about the outcomes. The result is a management process that reflects informed expectations rather than passive opinion.

This matters now

Crypto is reaching a turning point in how decisions are coordinated. Governance conflicts, tax disputes and stalled proposals have exposed the limitations of token voting. Even mainstream protocols struggle to translate token holder input into clear, effective action. This made governance snail-paced, contentious and dominated by a compact group of participants.

At the same time, there is a resurgence of interest in market coordination across the ecosystem. Prediction markets have shown how effectively markets can aggregate information, while broader discussions about mechanisms such as futarchy return to the fore. These systems emphasize markets as powerful tools for revealing beliefs and aligning incentives.

If crypto believes in markets as coordination engines, the next step is to apply the same logic to governance. The next phase of cryptocurrency coordination goes beyond straightforward asset trading and moves toward autonomous pricing and decision-making.

Token voting was the first attempt at decentralized cryptocurrency management and an essential experiment. This gave token holders a voice, but did not solve the deeper problem of incentives.

Marketplaces already power almost every part of the cryptocurrency ecosystem. They gather information, reveal beliefs, and align incentives at scale. A natural next step is to extend the same mechanism to decisions.

Decision markets also go beyond management votes and include capital allocation itself. If markets can price decisions about the direction of the protocol, they can also price decisions about what to build and finance. This opens the door to a recent generation of ventures built directly on cryptocurrency rails, where projects can raise capital and allocate resources from day one using see-through, incentive-aligned mechanisms. Instead of relying on passive voting via tokens, markets can actively guide the formation and development of onchain organizations.

Management without pricing is incomplete. If cryptocurrency truly believes in markets as coordination engines, the future of onchain organizations cannot be decided by votes alone, but by markets.

Opinion: Francesco Mosterts, co-founder of Umia.