SpiderDAO -The challenge explained.

4 min readDec 1, 2020


What is Governance and why do we need it? It is a system and process, not a single activity and therefore successful implementation of a governance strategy require a systematic approach that incorporates strategic planning, risk management, and performance management. Governance delivers good products which in turn leads to good business performance and financial sustainability.

What makes good governance. There is no hard fact that determines which form of governance works best. It may vary from organization to organization and even from country to country.

There is a new age type of governance that is fully automated and controlled by its community. No third party can interfere in its operation, and it eradicates the customary laws of traditional governance models.


DAO is short for decentralized autonomous organization. The first fully functioning DAO was Bitcoin, and it’s still running very successfully.

Decentralized means that it’s not controlled by a single institution like a government or a bank. The decisions related to the DAO are divided among community members who are also its end users. Decision making becomes a crowdsourced process.

Users have voting rights in the form of tokens, which they can use to raise issues and vote for different projects. DAOs were designed to be decentralized and fully automated. When we say automated, we mean it, as DAOs have no CEOs, board of directors, owner, etc. DAOs remove the need for hierarchical governance.

This may seem like a great way of governance, but it also has loopholes, problems, and exploitations. Let’s explore these issues further…

Issues with DAO:

Smart contracts are a viable solution for a transparent and autonomous election, but the story is more than that, implementing this approach has revealed vulnerabilities in DAO’s.

These issues are set out below:


Elections are conducted through tokens in DAOs. The majority which holds the most significant number of tokens are called whales. These whales can skew elections in their favor at every opportunity, and nothing is stopping them. Whales amass governance tokens and convert them into voting rights. This way, minorities have no say in any matter and plutocracy dominates.

Dark DAOs:

A majority with malicious intent is called a dark DAO. They are unidentifiable and untraceable. Dark DAOs can skew the election at their will, and no one can stop them. They accumulate votes to manipulate an election or market, undermining users’ trust in voting systems to overthrow a governance system completely.

Smart contract attacks can be identified through on-chain activities, but dark DAOs are almost invisible. In a nutshell, they buy votes from users and rig the election.

Exploitable governance:

How are elections conducted, or how is a decision taken in DAO? Through votes. So can any large organization buy and accumulate votes to rig elections? Yes!

DAO suffers from vote-buying, which is a deadly form of election fraud that negatively impacts users’ election integrity and faith. Malicious parties can effortlessly purchase or borrow smart contracts from different users for a short period. The party then uses the inappropriately acquired tokens to skew the votes and then dumps them once a verdict is reached and implemented giving the dubious party an unfair economic advantage.

How SpiderDAO is solving these issues:

SpiderDAO is built on the robust DAO framework, which introduces a dual governance model that offers a whale resistant solution. The solution pairs hardware and software tools with on-chain components that provide inherently democratic and anti whale governance mechanisms.

This allows the advancement of the network, feature development decisions, and the subsequent value creation to be dispersed among all users instead of controlled by a centralized authority.

SpiderDAO provides the solution with the help of three major entities:

  1. SpiderConnect Routers
  2. SpiderVPN
  3. SPDR Tokens

SpiderDAO aims to solve the problem using a combination of software and hardware approach. This process shifts the voting power from token holders to router owners. The weighting of the vote will be determined by the hardware router and NOT the number of tokens being staked via a members’ wallet. One SpiderConnect Hardware Router will equate to one on-chain vote, enabling demonstrable decentralization to be maintained at the hardware level.

To sum up this new age problem, SpiderDAO effortlessly eradicates all problems associated with traditional DAO. Additionally, the users get a decentralized VPN that can be accessed using SPDR Tokens, which assures complete anonymity.

If you would like to learn more head over to our Website and join our community on Telegram.

Some additional materials for your perusal:

Thanks for Contributing to the SpiderDAO community!




SpiderDAO is the industry’s first hardware-enabled DAO that bundles multi-layered hardware and software tools on top of Polkadot. https://spiderdao.io