My DAO Experiment: Part 1
For as long as I can remember, I have questioned things. Why can’t we have a clean environment? Why aren’t corporations on our side? How do we fix our governments? Is this as good as it gets?
In January 2017, I rediscovered the blockchain space, and quickly got sucked in. Who wouldn’t want financial sovereignty? Who wouldn’t want more privacy and trust? Who wouldn’t want to eliminate middle-men?
A new dialogue was emerging. A new structure. With different values and rules. A new beginning.
Unfortunately, the ecstatic feeling did not last very long. I was still using fiat currency. I was still working for a rent-seeker. The climate was still changing. I STILL HADN’T SAVED THE WORLD!
On top of that, the bubble had burst.
Yet something actually was different. Those questions I had been asking myself since early childhood had changed.
“Why can’t we have a clean environment?” became “How do we solve the tragedy of the commons?”
“ Why aren’t corporations on our side?” became “How will DAOs of the future benefit us most?”
“How do we fix our governments?” became “What kind of government do we want to build?”
“Is this as good as it gets?” became “How long will it take to build something better?”
Over the last 2.5 years, I have followed my curiosity with hope that these questions will be answered. This quest has led me ultimately to the world of Decentalized Autonomous Organizations (DAOs). I have known of DAOs for quite some time, but only recently did I commit to becoming an active community member. In the short amount of time I have been part of this community, I have seen that it is far different from any other organization in which I have been involved. I am excited to share my DAO experience with the world.
This is the first article in a four part series, intended to educate and encourage others to join the movement. I will hold your hand as I detail my ongoing experience in the world of DAOs.
Here is some basic information to get us started…
What is a DAO?
Depending on whom you ask, you are likely to get wildly different answers to this question. I will likely ramble on about the “Theory of the Firm” and “Tragedy of the Commons.” I would tell you that we have reached peak centralization, and that the pendulum is swinging back toward decentralization, individual sovereignty, and ulta free markets. I see DAOs as decentralized communities with a shared purpose and goal, with the ability and tools to govern themselves. A new kind of organization, that is more fluid, more democratic, more free, and more competitive than any organizational structure of the past.
But like I said, opinions vary widely on this topic.
Definitions from others in the space:
- Cem Dagdelen (cofounder of DAO Incubator): The technical definition of a DAO are tools for new forms of social organizations. The ideological definition of a DAO is that there are clear problems with hierarchical organizations of today (tragedy of the commons for example), with few innovations in this space. DAOs are the only thing really addressing these needs.
- Felipe Duarte (DAOstack Pollinator): I tend to refrain from extreme statements. DAOs are attempts at more distributed than centralized organizations, and we need to create a language that can conceive of a spectrum.
- DAOstack FAQ: DAOs are a new kind of organization that offer decentralization (lack of central decision making), transparency, and autonomous governance. This means that governance of the organization is conducted by the agents in it rather than by a small, select group. A few criteria: 1) no central control or information point; 2) no boss or hierarchy (unless the DAO chooses to!); 3) members allocate resources by vote on proposals; 4) there is complete transparency of all transactions
I think you get the idea.
Are there many DAOs?
The list of DAOs is quite limited, and include MolochDAO, DAOstack (Genesis DAO), dxDAO (not launched yet), PolkaDAO, Aragon, Colony, Giveth, bkDAO, Bounties Network, DAO Incubator, Edgeware, Gitcoin, oscoin. Each of these has its own raison d’ être, products and ideas with a vision and purpose.
However, there are many who believe that 2019 will be the “Year of the DAO”, and expect a similar boom to the ICO craze that swallowed much of 2017.
DAOs are growing up, fast, they say. Maybe.
Who can join a DAO?
It depends. Some DAOs are open communities, and anyone can start participating in them (e.g. DAOstack). Others are more exclusive, with some form of buy-in required in order to participate (e.g. MolochDAO).
What does DAOstack actually do?
The DAOstack community manages a pool of funds collectively. At any time, any person within the community can submit a proposal, ranging from research, to marketing, to protocol development and business development. If the community likes your proposal, they will vote to pass it. This allows anyone with the courage to try the ability to earn cryptocurrency for contributing to a decentralized project.
Why and how did I join DAOstack?
There are a number of reasons why someone might join a DAO. For me, it was curiosity, and the dream of being part of something bigger - with the potential to change the world.
Below my altruistic motives, there was an underlying desire to experience a DAO for myself. Was this really an alternative to “The Firm”? What are DAOs really good for? Can I create a DAO? What are some of the challenges faced by DAOs? I didn’t have any of these answers, and I desperately wanted them.
With some trepidation, I joined joined the Pollinators Telegram channel in late February 2019. That is all it took to join.
My first month at DAOstack
Over the next few months, I plan to explore what I call “My DAO Experiment.”
My plan is to document my experience, and outline how working for a DAO compares with other roles I’ve had. I plan to explore how the DAO makes me feel, explore challenges I’m facing, and speculate on where I see it all heading.
Below are some initial notes and and thoughts:
- DAOstack is an accepting and open community. From the moment I joined, it felt different, and continues to feel different.
- In order to get the most out of DAOstack, you need to harness your inner entrepreneur. To put it bluntly, there is a certain “hump”that one needs to get over in order to be able to contribute meaningfully to DAOstack.
- Finding information is hard. Information asymmetry is a real thing, and a challenge all DAOs will face.
- It has a different kind of hierarchy. For most of you who have worked within traditional organization structures, something will feel off. Sooo, who is my boss again?
I hope you’ve enjoyed this short primer into my experience with DAOs. In my next article, I will dive into the issues outlined above, and explore new ideas. Can I make a living in this space? What kind of opportunities exist for those looking to create DAOs? What have I been up to?
Stay tuned!
I’ve put a toe in the water, and the water feels…comfortable. Join me over the next few months as I dig deeper, and try to understand what exactly we are creating.
Special thanks to Felipe Duarte, and Cem F for providing their definitions of a DAO.
See Part 2 and 3 below:
