How Does the Transparency of a DAO’s Treasury Impact Its Strategic Investments?
The complete transparency of a DAO's treasury, visible on the public blockchain, has a dual impact. On one hand, it fosters trust and accountability among members, who can verify all transactions.
On the other hand, it presents strategic disadvantages. Market participants can see the DAO's positions, making it vulnerable to front-running, where traders execute transactions based on the DAO's pending large trades.
It also reveals the DAO's investment strategy, allowing competitors to anticipate its moves or copy its portfolio.