City Nouns launched with big promises: local, on-the-ground Nouns-style proliferation, funding creative public goods in cities worldwide. The mission sounded perfect for a DAO: no central authority, collective treasury, creative empowerment.
But as funds flowed in from Builder DAO grants, cracks began to show:
✅ Centralized Treasury Control
City Nouns’ treasury was governed by a multisig that remained in the hands of a tight founder circle. Repeated requests to expand signer diversity were delayed or ignored. Despite the decentralized rhetoric, real power over the funds rested with a small group.
✅ Forcing Out Key Contributors
One of the most telling signs of centralization was how dissenting voices were handled. Mary—an early, highly engaged member who repeatedly pushed for greater transparency, better accounting, and expanded signer diversity—was effectively forced out of the DAO. Instead of engaging with her critiques, the leadership painted her as hostile or unaligned, sending a clear message: speak up too much, and you’re out.
✅ Sybil Voting Accusations
When contentious proposals came up (like freezing the treasury or initiating audits), voting patterns showed unusual wallet clusters. Members alleged these were controlled by insiders or friendly factions, undermining the legitimacy of “decentralized” decisions.
✅ Resistance to Transparency
Requests for open accounting, signer expansion, and sybil audit were characterized as attacks. The leadership’s messaging became: “This is FUD. We’re protecting the mission.” Meanwhile, community discussion became tense and polarized.
✅ Refund Proposal and Governance Freeze
Eventually, a detailed governance proposal was put forward to freeze the multisig (prevent further spending) and refund unspent Builder DAO money. The idea was to prevent further opaque allocations until the governance issues were resolved. This proposal triggered heated debates about trust, mission alignment, and whether City Nouns had effectively become centralized.
✅ Outcome
As of the latest discussion, the community is fractured. Some want to salvage the mission with better transparency and shared control. Others see City Nouns as captured. The refund proposal forced a reckoning: Is this really a DAO if a few people hold the keys and silence dissent?
Because this is the textbook DAO anti-pattern. City Nouns didn’t fail because of bad intentions. It failed because the structures and culture didn’t enforce accountability.