With Darcy WE Allen and Sinclair Davidson. Available at SSRN.
Abstract: This paper helps allocate shared capital effectively in the Cosmos ecosystem by examining a range of different allocation mechanisms. We identify the core challenges of allocating shared capital – with a focus on knowledge, opportunism and coordination problems. We outline four mechanisms that capital allocation DAOs can use to allocate capital in different contexts: grants, prizes, tenders and in-house production. Each have implications for the transparency and accountability of capital allocation. Our findings help capital allocation DAOs make decisions about how to allocate shared capital across the Cosmos ecosystem.