Decentralized Autonomous Organization (DAO): What’s Next? A Look at
What is a DAO? What do they do? Why should I care? I found these questions difficult to answer when I started my research. The challenge stems from a variety issues but the two primary ones are: 1) the definition of a DAO is going through a lot of ideation and formation and we should not expect a clear answer for a few more years and 2) there’s not a lot of strong signal compared to the marketing noise. This post aims to amplify the good signal curating and synthesizing the best responses from the web3 community.
Note to Readers regarding the Metaverse
It’s hard enough to write about DAOs in a cohesive, neutral way — without conflating other concepts and topics. Therefore, this article will make no other reference to Metaverses. If you later want me to write about Metaverse, send me an email. You can find it on the about page.
What is A DAO?
The future is already here — it’s just not evenly distributed
— William Gibson
The story of a DAO is still being written, so instead of presenting the perfect definition, I will present a few varieties from noteworthy thought-leaders.
Aaron Wright
Aaron is a co-founder of Tribute Labs (formerly OpenLaw) with a near infinite amount of experience supporting a network of DAOs. The reach from his work is remarkable. Below are a few DAOs he’s supported:
- The LAO, a DAO of DAOs (or DAO as an Ecosystem) that complies with U.S. Law[1]. It’s a reboot of The DAO, which we will discuss later in this article.
- Flamingo is NFT art collectors and the later projects that support NFTs.
- Neptune is a venture capital DAO optimized for speed of liquidity. Members pool capital and then democratically vote on investment strategies[2].
- Museo serves as a place to collect and preserve NFTs. Think Internet Archive for crypto.
- Neon invests in metaverse assets, including digital fashion pieces and avatars.
All members of Tribute’s network of DAOs are accredited investors, and the tokens are only transferrable to other members. Together, Tribute’s network of DAOs has collected around a hundred and ten million dollars in Ether[3].
Aaron describes DAOs as a solution to a problem well-understood within the crypto community. DAOs can serve as a decentralized community for a specific topic, a way to enable people to unite, curate, and process information through dialogue and discussion in structured ways[4]. The structured part is interesting because two effective techniques for aligning people are incentives (reward tokens) and rules/governance (voting tokens).
Andrew Beal
Andy is the brainchild behind 30,000 ft, a substack newsletter that dives deep into all things crypto. Andy is a lucid thinker and fantastic writer. I suggest you all subscribe today.
Andy best describes DAOs as an evolution of decentralized autonomous corporation (DACs)[5]; technical structures that can potentially be used to mimic business structures such as corporations or investment funds.
DAO is a combination of two parts:
- One or more smart contracts that (a) hold capital (treasury) and (b) enforce a decision-making process.
- A token represents ownership in the DAO and the ability to participate in the decision-making process (voting).
These components — capital, ownership, and a decision-making structure — are the minimum viable components of a company.
Read more on my blog chrisjmendez.com
https://www.chrisjmendez.com/2022/03/01/decentralized-autonomous-organization-dao-intro/
