1. The Old Decentralised Governance Experiment - Cajas - And Why It Collapsed

Model: Until 2010, Spain had 45 Cajas de Ahorros - decentralised, non-profit, regional savings banks. Governance was stakeholder-based: depositors, employees, founders, and crucially - politicians from regional governments and municipalities sitting on boards.

Research Finding:

"Banking entities controlled by politicians obtained a poor performance and political influence on boards of savings banks led them to insolvency." Study on NML V.4 - presence of politicians in governance led to lower solvency ratios.

Comparison by EconPapers:
Three factors of success for decentralised banking identified:

• I. Short operational and functional distance and embeddedness in supportive regional bank associations - allows soft information advantage in lending
• II. Right to lend given at right time - Spain gave Cajas universal banking rights late (1980s-90s) during transition from statist interventionist model (Franco regime) to market economy.

Result: Between 2010-2012, 43 of 45 Cajas disappeared - merged into Bankia, Caixabank, Unicaja, Ibercaja etc. Bailout €60B. Governance failure = insolvency.

Governance Lesson Codified in Banco de España Law of Autonomy: After crisis, Law specified governing bodies of Banco de España - Governor, Deputy - must perform duties in balanced way, independence of economic authorities emphasized in 2020 testimony before Audit Committee on Democratic Quality.

2. The New Decentralised Governance Experiment - Blockchain / DeFi / DAO - Under Sandbox

Legal Framework:

Law 7/2020, 13 November for Digital Transformation of Financial System - Created Spanish Regulatory Sandbox in late 2020

Mechanism: Controlled test setting with limited duration and specific objective, enables companies with innovative ideas to test new products and services under supervision of legislator.

Overseen by: Banco de España (Bank of Spain) + CNMV (Securities Market regulator) + Dirección General de Seguros (Insurance) + coordinated by General Secretariat of Treasury.

Objectives under Law: financial sustainability control and risk minimisation; mitigation and adaptation of regulatory burden; creation of space to boost development of open financial innovation; attraction of international investment.

IMF Assessment 2022: "Banks play dominant role in Spain's fintech landscape. Sandbox delivers benefits but also imposes significant supervisory costs."

Experiments Approved in Sandbox:

A. Barcelona - Blockchain for Public Governance Co-production - ResearchGate Case Study
By creating autonomous, transparent, secure decentralized system, blockchain enables removal of intermediaries as trustees to be replaced by peer-to-peer based governance system. Used for citizen participation in municipal budgeting - Decidim platform. Implication for banking: redesign of governance in more transparent, efficient way.

B. BME (Spanish Stock Exchange) - Blockchain-based SME Financing System
Following successful pilot 2020, BME trials with SME financing ecosystem under sandbox created by Ministry of Economic Affairs and Digital Transformation. Tokenized SME loans with decentralised governance among investors.

C. BBVA Asset Management - First Tokenized Fund Through CNMV Sandbox - 2023-24
BBVA registered short-term fixed-income tokenized investment fund through regulatory sandbox of CNMV. Governance: Maker-checker governance for banking-grade operations - RBAC/ABAC with maker-checker approval workflows for all sensitive operations: issuance, transfers, compliance changes. This is decentralised governance but with banking controls - SettleMint DALP platform for Spanish institutions.

D. First Tokenized Issuance in Spain - Legal Form in Token - Cysae Case
"It was not easy to experiment with in a sandbox regulatory environment; this is first time such model has been applied in legal framework and accepted in Spain" - token represents share in securitization vehicle, governance via smart contract voting.

3. Case Laws - Governance Failures and New Governance

A. Cajas Governance Failure - Constitutional and Insolvency

1. Spanish Banking Crisis Cases - Bankia IPO Case - Audiencia Nacional 2020
Former Bankia board (politically appointed) acquitted of fraud in IPO but governance failure established - decentralised stakeholder governance without professional risk management led to collapse. Court held political control not criminal but regulatory failure.

2. Unicaja, Ibercaja and SPV Project - CJEU - Yearbook on Procedural Law - Demolishing Procedural Autonomy
For sake of effectiveness of Directive 93/13 on unfair terms in consumer contracts, CJEU judgments in Unicaja, Ibercaja and SPV Project urge courts of Spain and Italy to disregard essential principles of national procedural law such as res judicata, preclusion, party disposition.
Governance Impact: Spanish Cajas had inserted floor clauses (cláusulas suelo) in mortgages - governance allowed abusive terms. CJEU forced Spain to allow retroactive review despite res judicata - governance experiment failed to protect consumers.

3. UN Committee on Economic, Social and Cultural Rights - First Individual Complaint vs Spain - Mortgage Abuses
Committee mandated Spain to reform legislation that allowed banking entities to get away with abuses in mortgage proceedings violating right to housing under ICESCR. Direct result of decentralised Cajas aggressive lending governance.

B. New Decentralised Governance - Refinancing and Fresh Money - "Spanish Scheme"

4. Seville Commercial Court No 2 - Court-sanctioned Spanish Scheme - Cuatrecasas Case - Refinancing Agreement
Judge handed down order approving refinancing agreement, considering grant of fresh money by financial entities proportionate, and obliging non-signing entities to execute refinancing agreement also to supply fresh liquidity.

This is Spanish version of UK Scheme - decentralised governance of creditors via majority vote binding dissenting banks to provide fresh money - precursor to DAO-style voting in restructuring.

5. Decentralized Multinational Banks and Risk Taking: Spanish Experience - Banco de España Research Paper - BDE.es
Paper analyses effects of decentralized multinational banks, characterized by large autonomy of affiliates that banking group has abroad, on bank's risk using Spanish confidential supervisory data. Finding: Having activity abroad in countries whose business cycles less correlated can generate more stability in consolidated group. Santander, BBVA model - decentralised subsidiaries (UK, Mexico, Brazil) with autonomous capital, liquidity, governance - survived crisis better than centralized models (Deutsche Bank). This is governance experiment that succeeded.

6. Court of Justice - Spanish Scheme Fresh Money Obligation - Lexology
Dissenting financial entities obligation to provide fresh money under refinancing agreement approved by court - shows Spanish law allows cram-down of decentralised creditor governance.

4. Lessons for Banking Governance in Spain Today

Old Model Failed Because:

• Political presence on boards = poor performance
• No professional risk governance
• Soft information advantage lost when Cajas went national

New Model Under Sandbox Must Have:

• Banking-grade maker-checker despite decentralisation - RBAC/ABAC mandatory
• Banco de España + CNMV supervision even in sandbox - not pure DAO
• Token holder voting allowed for fund decisions but compliance changes require regulated entity approval (BBVA model)