Decentralized finance has driven the adoption of decentralized equity investment platforms, eliminated intermediaries and allowed direct transactions between investors and companies. Such platforms are faced with regulatory compliance and operational effectiveness. This review critically evaluates the potential of Directed Acyclic Graph-based blockchain architecture in addressing these issues. According to the examination of previous work and technological progress, the paper analyzes how Directed Acyclic Graph-based networks enhance speed, scalability, and security by including regulatory requirements like Anti Money Laundering and Know Your Customer compliance. A comparative analysis of Directed Acyclic Graph-based and traditional blockchain systems recognizes the advantages of Directed Acyclic Graph’s parallel processing and low-latency transaction validation. Furthermore, this paper examines potential limitations, such as interoperability challenges and regulatory risks, and explores potential solutions to facilitate broader adoption. Through a synthesis of findings from multiple studies, this paper contributes to the existing body of knowledge on how Directed Acyclic Graph-based blockchain has the potential to redefine decentralized equity investment platforms. It provides a foundation for additional research on how to enhance compliance mechanisms and achieve the greatest efficiency in decentralized financial ecosystems.