Gen Z’s uprising in Nepal shows what DAOs could become

Discord became Nepal’s digital parliament as Gen Z organized protests, echoing the vision that has driven DAOs since inception.

The day Kathmandu lost patience

In September 2025, Nepal was thrust into one of its most turbulent periods in recent memory. The trigger came on Sep. 4 when the government abruptly banned major social media platforms, including Facebook, YouTube, Reddit, X, and others. 

Officials framed the decision as enforcement of new regulations, but for millions of Gen Z Nepalis, it felt like an attack on their ability to speak, organize, and share information.

The anger was especially sharp among younger citizens who had long relied on these networks to build community in a political system long seen as corrupt and unaccountable.

On Sep. 8 the frustration erupted. Thousands of mostly young protesters filled the streets of Kathmandu, converging on symbolic gathering points such as Maitighar Mandala and New Baneshwor. 

Their chants demanded transparency, accountability, and the restoration of online freedoms. Security forces responded with escalating force using tear gas, water cannons, rubber bullets, and eventually live ammunition. 

At least 19 people were dead by the end of the day. Curfews were imposed, yet demonstrations spread to other cities, showing how deep the discontent ran. 

Meanwhile, Sep. 9 saw an even sharper escalation. Protesters set fire to government offices, including Singha Durbar, damaged the Supreme Court, and clashed outside the prime minister’s residence. 

The scale of the uprising made clear that the protests were no longer about the internet alone but about the legitimacy of the entire system. In the evening, Prime Minister K. P. Sharma Oli resigned, parliament was dissolved, and Nepal slipped into a political vacuum.

With conventional channels of communication blocked, protesters turned to alternatives. One platform not covered by the ban, Discord, quickly emerged as the space where marches were organized, updates verified, and momentum sustained.

Discord as the new parliament

While the streets remained volatile, a Discord server swelled past 100,000 members and soon earned the nickname Parliament of Nepal. 

Inside it, conversations carried the intensity of a real assembly. Channels were set up for logistics, first aid, and fact checking, but the main focus was the search for interim leadership.

Moderators gathered suggestions from thousands of participants and gradually narrowed them into a shortlist. The process unfolded in full view, with polls, tallies, and debates visible to anyone logged in. 

Five figures emerged at the forefront. They were Dharan’s populist mayor Harka Sampang, innovation advocate Mahabir Pun, independent politician Sagar Dhakal, lawyer and YouTuber Rastra Bimochan Timalsina, and former Chief Justice Sushila Karki.

The debates resembled town halls. Tens of thousands followed live streams as organizers attempted to contact candidates directly, sometimes announcing to the audience when calls went unanswered. 

Kathmandu’s mayor, Balen Shah, who could not be reached during these sessions, later used social media to endorse Karki, a gesture that further boosted her standing.

Karki’s reputation carried weight. Many remembered her decision in 2012 to jail a sitting minister for corruption and her refusal to bend to political pressure during an impeachment attempt in 2017. 

Inside the server, support for her candidacy solidified. Internal polls on Sep. 11 showed her with a decisive lead. Attention shifted from whether she should run to how best to unite behind her as the only figure acceptable across factions.

Discord became the nervous system of the protests as well as the incubator of leadership. The civic group Hami Nepal used it to circulate safe routes, announce marches, and share hospital contacts. 

Screenshots revealed infiltration attempts by pro-monarchy groups, yet participants described the environment as more transparent than traditional party politics because all debates and votes unfolded in public view.

When the president and the army chief considered options for interim leadership, the signal from Discord was impossible to ignore. 

On Sep. 12, Karki was confirmed as interim prime minister. Her mandate to oversee elections by March 2026 came not only from legal institutions but also from a process that had played out openly before tens of thousands of citizens in a digital assembly.

That sequence of online debates leading to an offline appointment is what now links Nepal’s Discord moment with the early promises of DAOs, even if nothing about it was on-chain or legally binding.

DAOs vs Discord — structure and limits

Decentralized Autonomous Organizations, or DAOs, emerged in the crypto ecosystem to build a structure around collective decision-making. Scale alone shows how far the model has spread. 

According to DeepDAO data from Sep. 15, more than 50,000 governance entities have been launched. Around 2,500 remain active with enriched data, collectively overseeing treasuries worth about $22.5 billion and involving more than 11 million governance token holders.

Numbers alone do not explain what makes DAOs distinct. The difference lies in design. Discord debates resembled open town halls where participation was fast and barriers were low, but safeguards were largely absent.

DAO governance introduces structure and accountability. A wallet and a governance token are required. Proposals are posted on-chain. Thresholds and quorums are embedded in code. Execution can take place through smart contracts. Decisions become traceable and binding inside the system.

That structure, however, comes with trade-offs. Token distribution often concentrates voting power in the hands of a small group.

Chainalysis reported in 2022 that less than 1% of token holders controlled 90% of voting power in a sample of ten major DAOs.

Participation can also be gated by thresholds. In many projects, at least 0.1% to 1% of the token supply is needed to propose a change, and between 1% and 4% is required for approval.

The Ethereum Name Service (ENS) highlights how power can cluster even in widely praised DAOs. A 2024 governance analysis, covering activity from Q2 2023 through Q1 2024, found that the top 1% of ENS token holders controlled about 62.4% of voting power.

Small holders, who made up 97% of all addresses, together controlled just 2.1%. Even in communities celebrated for openness, early adopters and large stakeholders remain dominant.

Participation was another area where Nepal and DAOs diverged. Discord rooms stayed active each night at the height of the protests, with tens of thousands debating leadership in real time. DAO turnout has often been weaker. 

A 2024 study of Ethereum-based systems such as Compound (COMP), Uniswap (UNI), and ENS found that less than 10% of total tokens, or about 15% of circulating supply, were typically used in votes. 

The gap between the energy of Nepal’s moment and the lower levels of DAO engagement raises questions about how sustainable large-scale participation can be.

Legitimacy under law is an even sharper distinction. The appointment of Karki carried constitutional authority once confirmed by the president, while the Discord poll could only influence that choice indirectly. 

DAO votes, even when fully transparent and executed on chain, face the same limitation. Only a handful of jurisdictions, including Wyoming in the U.S. and the Marshall Islands, have formally recognized DAOs as legal entities. 

Without such recognition, their decisions cannot compel courts or governments to act, no matter how many participants are involved.

Expert insights on precedent

crypto.news asked three DAO experts to weigh in on the lessons from Nepal’s Discord experiment. The experts agreed that the episode was less about whether digital crowds can organize and more about whether those decisions can be enforced, made accessible, and designed to last.

The question of enforcement was unavoidable. Discord gave protesters a way to surface Karki as a candidate, but the outcome only stuck once the president appointed her and the army accepted it. Paulo Fonseca, Delegate at Arbitrum DAO, argued that this gap cannot be ignored.

“Those who control the means decide what is legitimate in the end. No matter what tools we use to determine what a population wants, there is always the need to enforce decisions and that is where real power lies.”

That limitation is why some see DAOs not as political systems in waiting, but as structures that can govern resources directly. Joël Valenzuela, Director of Marketing and Business Development at Dash, said legitimacy comes when execution is automatic.

“DAOs are only worth their enforcement mechanism. If results are enshrined in law, they matter as much as any legacy voting mechanism. If a DAO vote awards keys that control key communication channels or release funds to specified recipients, no legal enforcement mechanism is necessarily required.”

Andreas Melhede, Co-founder of Elata Bio DAO, agreed that until legal recognition exists, most DAOs remain inward-looking.

“The legal system doesn’t really make it easy for DAOs to enforce their decisions, so for now DAOs mostly govern their own communities rather than trying to replace political or legal systems. Without recognition in law, there is a risk that DAOs can be seen as talking shops without real power, no matter how engaged the community is.”

If enforcement is the hardest barrier, accessibility is the most immediate. Nepal’s Discord servers worked because anyone could join quickly, which explains why they drew more than 100,000 members in days. 

Fonseca pointed out that DAOs have better tools for filtering who gets counted, but have not yet matched that simplicity.

“Discord is very easy to use, but it lacks protection against sybil attacks because anyone can create multiple accounts. With identity tools tied to national IDs, each citizen could vote once and only once, and we could run elections that are both inclusive and secure.”

Melhede added that DAOs do not have to be all or nothing. Processes can begin open and then narrow as decisions become binding.

“DAO voting can be phased, sometimes open in early steps and token gated later. Complexity varies by project, but many teams are working hard to make participation as straightforward as what we saw in Nepal.”

Valenzuela questioned whether Discord is really less technical than DAOs. He argued that what feels easy is often a matter of habit.

“We far underestimate the complexity involved in just setting up a Discord account and passing server filters. For crypto native users, signing with a wallet can actually be easier and more intuitive than the legacy steps.”

The last issue was maturity. Nepal’s experiment was raw and improvised, yet DAOs claim to have been building frameworks for years. Melhede returned to first principles, arguing that decentralization itself is the test of whether a DAO delivers on its mission.

“Web3 projects, including DAOs, always fall somewhere on a spectrum between fully centralized and fully decentralized. The more decentralized a DAO is, the more likely it’ll stay true to its mission. At its core, I define a DAO as a democratic organization. If that foundation is strong and upheld, then voting on key issues and rallying people are some of the most powerful things a DAO can do.”

Fonseca insisted that the infrastructure is already capable of running decisions at scale, a contrast with Discord’s improvised use.

“Over the last few years, DAOs, and more specifically DAO tooling, have already matured the set of infrastructure and apps that allow for this kind of thing to happen on-chain. And these tools are open-source and battle tested enough to secure and govern billions of dollars.”

Valenzuela pointed to the track record of projects like Dash to argue that DAOs are no longer just experiments.

“While DAOs are still relatively emergent, I believe they’re ready for the big leagues. DAOs already manage hundreds of billions of dollars, much in excess of Nepal’s current GDP, and some have been operating for a decade or more.”

That sense of readiness contrasts with what unfolded in Kathmandu, where Discord showed how quickly digital forums can mobilize at scale and shape political decisions.

The question now is whether DAOs can supply the enforcement, traceability, and structure that Discord lacked, while keeping the same sense of openness that made Nepal’s experiment possible. 

What happened in Kathmandu was not the arrival of DAO politics, but it was the clearest sign yet of why people have been trying to build them.