Is Decentralized Autonomous Organization the future of work?
The dream of decentralization.
“You never change anything by challenging existing reality,” Buckminster Fuller once wrote. “To change something, build a new model that makes the old model obsolete.”
One of the ‘new models’ emerging from Web3 is the rise of the Decentralized Autonomous Organization (DAO). When I first heard the term, I thought I was hearing a reference to the ancient taoist practice, but what I’ve learned is the DAO is an important building block in the Metaverse, and even if the Metaverse itself turns out to a dream of elitist technologists, the idea of a decentralized economic models feels like the way forward for me.
I'm one of those guys who looks at the current state of economic affairs and is not all that impressed. it cost me ten grand to go to college and it cost my daughter 140 grand. That's a pretty big span over a forty year period.
Does that feel right to you?
We need some new ideas.
What is a decentralized autonomous organization?
Basically, it’s a way for like minded folks around the world to work together on internet projects collectively owned and managed by members of the DAO.
Rules for how the DAO operates are encoded as a software program, transparent to all members. This builds an organization open to all members, shaped by its members, and ultimately in full trust of its members. Goals and plans for the DAO are developed by all members, with no central authority. Every member of DAO has a voice and decisions are made by proposals and votes on the proposals.
Kind of like the legendary Park Slope co-op in Brooklyn, yes, kind of like marxism on steroids, but I never bought the anti-marxism propaganda. The guy had good ideas. Read Capital for yourself.
So is the DAO concept communism?
I see it as more about trying to bring. bucket of honesty to the bonfire of corruption that has become much of 21st capitalism.
But this DAO does sound utopian, if Utopia is precisely defined and operated according to preset rules.
Is the idealized and ancient business model of an authentic co-op truly attainable in the new digital economy? Is it possible a fair and equitable distribution of revenue from partnerships assured?
How does a DAO work?
The core nervous system of a DAO is the Smart Contract.
The contract defines the rules.
The contract holds the Treasury.
The contract can only be changed by a vote.
Underhanded dealing (hey, we are talking about humans) will fail the rules test. This protects the DAO and promotes trust and transparency. The smart contract also defines how money is spent and payments are made. There is no need for a Central Authority since all transactions will pass automatically when they recieve the votes from the membership.
I’ve heard DAOs defined as an ‘unregulated’ corporation, but that’s not exactly the story. DOAs are a ‘self-regulating’ organization, only made possible by the new economics of the digital realm.
A DAO works directly for the members, is grown by membership engagement, adds value by membership participation, and distributes earned revenue by pre-determined rules. A DAO gathers interested parties around a shared goal and creates dynamic collaborations on a global scale.
Who creates a DAO?
The idea of sharing work is certainly not a new idea. It goes all the way back, perhaps to some antediluvian farmer suggesting hey, let’s all plant the crop together, and share in the bounty. Let’s form a tribe, a gang, a team, build a city, divert the river for irrigation, whatever the job, let’s get together and get the job done.
The idea of a DAO is the same.
We have a shared goal.
We need to get the job done.
Let’s work together
So a DAO could be a group of developers coming to gather to share tools, and risks. Or investors looking for similar opportunities. Media companies, charities, freelancer organizations, any type of company can opt to be DAO, but there’s one facet of the DAO organization that stands apart.
Starting-up any venture requires a level of trust among the investors, whether it’s investors putting in funds, or workerd investing time. In a DAO, trust is offered through the DAO’s code, transparent and certifiable by everyone. Professional organizations, passion projects, indie companies, fan groups, influencers and gig workers can all benefit by building DAOs and accessing the benefits of transparency and trust.
Who should join a DAO?
Web3 continues to disrupt industries, but with more punch, because to date the internet is mostly a pyramid. Beyond the fanciful flights of internet utopia that have been written about and praised over the years, the bottom line is internet business sends revenue in one direction—up. We have massive internet models with user content generated for free and revenue reserved for a digital elite. In addition users of massive crowd-content sites provide their data and ownership rights of their content. A DAO is a way to circumvent this, control your content, own your content and set the rules for how your content and profiles are used.
DAOs allows members to build and create and own their content, and creates leverage for distribution of the content.
The future of work is crypto, social organizations built for purpose, businesses built around tribes, small ideas using global reach to become big ideas. The timing is perfect for the emergence of DAOs. New advances in blockchain, V/R, A/R technologies, and a perceived need as we emerge from the pandemic and deploy a remote workforce distributed around the globe. DAOs sit in the center of all this. Participation in a DAO today leads to yields in the future.
That's the way I see it at least. Nothing ever quite works out he way you imagine, but keep on an eye on these concepts. Even a raw dog capitalism venue like Hollywood, the idea of shared co-op profit mills are taking hold. Not in any way as an altruistic response, but as a way to control costs AND deliver profits, just with an equity distribution against a favored nation flag.
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