Can Decentralized Autonomous Organizations (DAOs) Be The Solution To Our Financial Problems?
We hear them discussed a great deal. However, do DAOs really have a place in this world? Could they really be the solution to something much larger?
As we proceed forward, technology is advancing at a pace that we never saw before. Some are starting to warn that the threat to jobs is becoming paramount. While much of society seems content to ignore the threat, believing that we will create more jobs than we destroy, some are starting to consider how this can be resolved.
If we are looking at hundreds of millions of jobs disappearing globally, how are people going to make a living? Some opine that Universal Basic Income is the solution. Here is where the government simply provides an amount of money each month to "cover the basics". Unfortunately, even if that plan is financially viable, it puts government, and hence the political winds, right in the middle of one's sustenance.
Could there be a better way? DAOs might offer us some insight.
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A New Ownership Structure
Perhaps the way to understand a DAO is to look at Bitcoin. Many proclaim this the world's first DAO. We cannot doubt that it fits within the definition. However, it does not appear to solve the problem we are concentrating upon.
A DAO is similar to a stock in an autonomous organization. It removes the needs for a hierarchical power structure since few humans are needed. The organization, once coded, is able to operate on its own. Periodically, updates are required or some specialized service needed. Nevertheless, for the most part, it runs on its own.
The ownership model is done through tokenization. Each token has a stake in the DAO, encompassing whatever benefits come with holding it. For example, profits could be distributed based upon the percentage each token represents. It can also factor into the governance of the organization.
How does this differ from a corporation? Simply, the absence of people is the key. We do not see automated companies. Instead, automation is owned by corporations. This is what can make them profitable. However, it is tied to the existing financial system which tends to be exclusionary.
For example, all the major Wall Street banks have their proprietary trading systems. These are automated in that they run without human intervention on a daily basis. The software executes buy and sell orders based upon the coding. Of course, all profits are part of the bank. Thus, shareholders technically have a piece of what is generated although it is mixed in with everything else the company is doing.
A DAO related to a specific purpose. This means ownership is tied to some type of automation.
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Universal Basic Asset
This is a twist on the universal basic income. What we will focus upon here is a bit different than what most propose. However, as we can see, cryptocurrency offers solutions not previously possible.
One of the keys of eradicating poverty is to get people into a situation of "ownership". The challenge for most people is they own no assets. Without this, it is hard to get ahead. Wealth creation comes from owning assets that can generate incomes in addition to the direct swapping of time for money.
Since most do not fall into this category, DAOs might be the solution. It also could help to remove the government being in the middle of everything.
A concept that people are discussing is the idea of "robotaxis". Basically, this is Uber on steroids. Ridesharing is a huge business and will likely become a lot bigger if forecasts of the cost per mile dropping are correct. Removing the labor from the equation really drives down the cost.
How could this be structured in a way to benefit the members of a community? If we were going to go with a Universal Basic Asset approach, perhaps the taxis are purchased by a local municipality. Each vehicle (or the entire fleet) can be a DAO, tokenized, and given out to all citizens in the community. Thus, each person living there has a stake in the local transportation service. The profits from the operations are paid out to each token holder.
The same idea could be applied to infrastructure. As we proceed forward, digital infrastructure is going to be more important. We know that, as the years pass, we are going to require more bandwidth.
Obviously, the average person is not capable of setting up or running nodes. In fact, the majority do not have the resources to do this. However, if we apply the same DAO concept, we can see how this works.
Perhaps the same municipality sets up a bunch of servers to run some type of digital infrastructure. It could simply tokenize the operation, ensuring payouts from the network operations. Here again, the citizens of the community are able to profit from autonomous operations.
It is a concept that can be applied to anything autonomous.
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From Governments To Networks
Of course, we have to be aware this is already in operation. There are many times we are seeing this concept applied. While the term Decentralized Autonomous Organization is not applied, we are seeing the basic tenets of a Universal Basic Asset being constructed.
It is called an airdrop and we see it all the time. While it can be nothing more than a marketing ploy in many instances, there are times we see this happening.
A prime example is the project by the 3Speak team. Here they are developing an entirely new network. The decision was made to drop the mining tokens to all holders on the Hive network. This means that each person who has stake in the latter will be able to mine for the governance token on the former. This becomes a Basic Asset that the individual token holder can benefit from. It becomes Universal since it is dropped to every individual holdings on the Hive blockchain.
Here we are seeing the transition from governments to networks. The community is not based upon the geographic location one is in. Instead, it is applied to the network one is tied to. In a digital world, physical location means nothing. It all comes down to the network.
One of the keys is that people are beginning to enhance their stake through activity. Since much of the world does not have the money to buy into many networks, having the ability to get rewarded is vital. Through the use of applications, we can see how this is going to unfold. Whether it is gaming, social media, finance, or a host of other things people do on a daily basis, individuals are going to be able to spend time increasing their stake. Through the reward mechanism, "ownership" can be achieved.
This naturally feeds into the expansion of new projects. While not all are DAO, they are Digital Organizations (DOs). Having a stake in something like this can be very profitable as those who invested in Facebook, Twitter, or Google know.
To truly move forward, decentralization of ownership needs to take place. This is where the Internet went wrong in its original design. The absence of commerce at the base layer allowed for applications to silo things for their own benefit.
DAOs (or Digital Organizations) can eliminate this. From this principle, we can focus upon different ways that spread ownership out across huge numbers of people. With each new project, the potential exists to decentralize even further.
Ultimately, this could be the solution to the financial problems that plague much of the world.
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can be but i don't think lot of gov would allow that
What does government have to do with an autonomous organization?
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They want to control our financials freedom like USA is taking crypto as national security and you bet they will try there best to control it but I don't think they can
The Government in Nigeria alone is myopic by banning crypto fo so long now.
You can’t transact with local banks/currently without a middleman.
Yes well there is resistance to all of this because it threatens power.
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Nice write up. My opinion Basic Assistance is slavery. Once you rely on the Gov. for your livelihood they control you.
The Basic Asset concept is interesting as long as it is not free. People should have to work or invest into it. That gives both the individual and the asset value. Local Gov. involvement on a small scale is fine, but anything larger I would be against.
There are a lot of assets that are in government control or could be erected that do not require buying in.
For example, if a city establishes a robotaxi network, you think people should buy in. Isnt that just maintaining the same slavery system we have?
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Well it's not an easy question to answer. For example where will the funds come from for the robotaxi? The tax payers? What is the requirement to participate? Must you have lived in the city and have paid taxes for "x" amount of years? What if you moved there 6 months before launch? Don't get me wrong, I think it's an interesting idea, I just don't think it's a good idea to give people something for nothing. We've worked hard on HIVE for years blogging, engaging, etc. We have stake in the "asset" "community". Some of us bought our stake and that's fine too, but I wouldn't want someone coming in and getting something from HIVE without putting in any effort or funds for it.
No I understand what you are saying. There are many variables to consider. For example, some are in a city for decades, paying taxes. Their share should be higher, at least in principle, than someone who just moved in.
So we have a lot of things to work out. Over time, it becomes less of an issue as people get more involved and start the revenue stream flowing.
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One time I saw in our top university here in the Philippines someone proudly wearing a t-shirt with a message that says, "End private property!" I think, generally the mindset in the academe is one of hostility against private property and what they mean by ending property is others' property, not their own.
I see this as the root of the problem, but others see the government as the economic Messiah. That's really sad to see an institution posturing to solve the problem that it creates.
The first time I heard this airdrop thing, I was wondering what does it mean. During my first month in crypto, my youngest son and I actually participated in 20 of them, and nothing came out. But this airdrop that requires staking, this one makes sense and you actually see token being dropped into your wallet.
When I explain this to my friends, they just stare at me with a blank face. They find such incentive mechanism unbelievable.
That is true most do not understand. It is too new and people have not grasped onto things outside of what they know. This is why early adopters are truly trailblazers.
As for the airdrops, whatever Hive you had on Jan 6th is what you are going to get in LARNYX miners when the claimdrop starts. It will be divided into 12 separate sections, claimed once a month.
We will get more details in the next few weeks.
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Could not wait to see that. Thanks for the clarification.
DOAs have their rules embedded into a code so that we can first remove bureaucracy handicaps.
It can do that too. There are a lot of advantages to autonomous organizations. People are such a hassle and truly do stupid stuff.
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I love reading ur articles because I learn alot from it and abt crypto. I gat to understand technology has taken the future and will develop the economic
Thanks for the support. I am glad you find them informative and helpful. Educating while also passing along information is very important.
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Owning asset can eradicate poverty because that assets can generate income steady to the person.
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That and the appreciation value as these entities become worth more as they expand and grow.
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Yes
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DAOs for sure are the hope of better governance, if they work or not it remains to be proven. But they are at least challenge current traditional systems which are prone to corruption and cheating.
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I am not sure the structure is what needs testing as much as the individual projects. Some DAOs will be a total failure, others a raging success.
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DOA certainly give the economy a great chance though is faces some demerit and implementation process to suit the whole society. However it is a tool the will crumble and shaken the govt a bit but the percentage of DOA gaining a strong ground is such that will take a long time despite the advance of technologies in the society. If DOA can secure or be used at 60% of business operational exp. (Daily expenses) then it have a big win on the economy.
The reason it is so powerful is because nobody controls it and the fact that it is out of the reach of governments. This means that it is an entity that exists solely in the digital world.
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I think this aspect of transition from government to networks is what most governments around the world is fighting against. For instance, the said reason for banning cryptocurrencies operation in Nigeria was because the Central Bank of Nigeria (CBN) couldn't regulate the transactions of cryptocurrency holders. I believe since most governments can't create employment opportunities for their citizens, they should allow the operation of DAOs all over the world. Most jobless and unemployed youths are now having a means of livelihood in digital organizations. Therefore, it's important for citizens all over the world to push for the adoption of Decentralized Autonomous Organization. Thanks.
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I would agree. There is a major threat although I am not sure governments realize the extent it is. They are looking at it from a financial perspective which is only one element of it. This is going to snowball and hit them on many different levels.
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I never thought of airdrops as a way to distribute the tokens in a universal aspect. Most people just tend to think about it as either free money or marketing for the most part. It sure is different from the current system where the people who are rich or have power gets most of the benefits.
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That is what they basically are used for up to this point so it is hard to dispute what you say.
However, if we consider how universal ownership within certain populations/communities, we can see how it all changes. This opens up a great deal more possibilities.
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Networks as government is a great idea, but as I said in a comment on [https://leofinance.io/@iconoclastic/nation-dao](Nation DAO) you have to drive people and money into the system, so the engines will sputter to life. I think the people don't have the collective will to do that right now. Maybe if things get worse for them, they will? People are too comfortable with where they are now or too busy fighting the other end of the political spectrum to notice the real problems.
There are many who are not comfortable. Yes we see a large portion of the population who is business as usual. However, keep in mind, this is above the heads of most. Few can understand it at this point. But ease of use is creeping in.
We are building the infrastructure for people to use to change what is taking place.
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This is true, but to be fairly honest, this idea is hard to sell to people who are in poverty. The main reason is if you are in poverty you do not have enough education, it might be the case for everybody but it is for the majority of people especially in third world countries, so yes, people don't own assets because they choose not to, they will be fairly reliant to the government because that is the only thing they can do, and hope that someday someone is good enough will sit at the top of the government and take them out of poverty, they have the asset but they did not use it.
DAO could really be the answer, but truth be told we need to start at the roots and it should be education before anything else, seeing how corrupt people are, yes they might set up something that can help a lot, but it will always have a huge cut.
Educating people will prevent this from happening, I still believe knowledge is power so whatever you throw in to help people get out of poverty without proper education, people can never get out of poverty.
Take this as an example, in our country we have a program called PPP which the poorest of the poor should get a monthly budget from the government BUT where does this money go? To people that aren't poor, why? because the poorest of the poor doesn't even know it exists, people that have the knowledge it exists, exploit it by doing everything to make the cut. They same as airdrop, it's either we have no knowledge about it or we just simply don't have enough assets.
It's a shame but, whatever system is there to let's say help people to get out of poverty or even have their own assets. Without proper education, it can never happen.
Let's say DAO is implemented all over the world, how many percentages of poor will know it exists? I think probably 1%? because people who know it exists will not share it with everyone to keep their big piece of the cake.
But your post is great and you have written your insights well and you definitely deserve this !1UP
I agree with you about education but the reality is that anyone with an internet connection can learn whatever he or she wants to. The will to learn has to be there.
No matter what country, most people simply stop learning once they leave school. This is the choice most make.
So the proverbial lead a horse to water...
Cryptocurrency is out there with a ton of information written about it. People can learn if they would choose to.
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Yes with internet everyone can learn, sadly poorest of the poor cannot afford the internet nor they can afford school. Some chose not to go and they hustle to find money instead, so if education system especially in third-world countries isn't fix, every program to help the poorest of the poor will not achieve it's goal
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the development of DAOs is currently interesting,but currently to solve a project you must have a good planning and idea of working with these tokensIt is very easy to lose investment capital due to panic sales, I found a way to avoid this problem.follow me and you will be surprised
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Hi,
I intend to participate in some DAOs to understand the concept better. Like Web3, the concept is new and it seems to me that its meaning will become clear over time with the practice.
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Start voting on the Decentralized Hive Fund.
Just by having some Hive Power you are involved in a DAO.
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As long as they can operate autonomously like in the example of "robotaxies" they have a very bright future. Right now the DAO's I'm involved in are all struggling with the same issues.
Most of them aren't really decentralized and 2-3 wallets can outway many small holders when a proposal is up for voting. In almost all cases, even if the proposal gets voted on by the community the developer doesn't really have to execute the will of the owners if they don't feel like it.
When DAO's become protocols I will be insanely bullish on them. For now, they are an interesting speculative game, at least for me.
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Like anything it is all about the set up.
Same with Blockchains. We know the ones with huge founders' stakes are a problem. So what is being done with the distribution is a major question.
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Now you keep going back to these dao's. We already got a dao on hive that's completely full of shit. I don't know why you think there is going to be some true decentralized dao. It's never ever going to be and i'll kill this other dream of you guys.. It's never going to be any such thing as true decentralization ever in this uiniverse period.
What there has to be is your basic right and yes it has to be a right.. to the dignity to live with a basic income and have your basic needs met in an advanced civilization as they should function. wHat the heck is the purpose of a government with starving sick folks.
Now, i'm not going to have this conversation with you again. I'll have it with someone else but not you. The real issue is many of you are hung up on freedom and rights... Let me tell you something about that. That is an illusion.
The only freedom that exist in this universe is the freedom that allows you to get up and have breakfast in the morning. When you're no longer able to do that for any reason. I don't care what the reason is.. You my friend don't have any freedom. One of the greatest philosophers in the world said freedom starts at breakfast.
So if 1% of you all got what you want and got your breakfast and 99% don't I don't give a shit about what you call rights or freedoms or whatever.. and you shouldn't either. It's ridiculous period. This is unavoidable we can't beat the machines ever in any reality.
it is over man. It will be soon listen to people smarter than you guys. it's not just elon musk my goodness man it's a ton of smart economist and genius level people. why the hell you think i created the auto curation system to correct this problem? i created that system. You all didn't create it you certainly don't know how to create it. Those are the only systems that will set men free and truly give him dignify..
You wanna keep playing a shellgame you can't win? You eventually going to be on the bottom of that game sooner than later. Hive can't do it without the proper application that it doesn't seem like hivers can ever find or understand.. their brains are like putty oblivious to this. and it's for their own good. It's for their own good relatively to my own. I guarantee you i have several times over more than the average hive user.. so my suggestion is wake up before it's too late. or it's gonna be your ass and that's real.
So that's you guys choice. i create systems if i needed you guys i'd sure as hell be using your systems and not creating my own. " i know" you all will need my system.. I damn sure don't need yours and whoever needs you guys system will be very very dissapointed. So that's my last message on this type thread from your authorship. i'll be on more. Ignore the info at your own peril and if crypto people are too ignorant to grasp this in time.. evolution will eat them alive.. the evolution and revolution of robotics will end them very quickly. They spend millions of dollars on crappy doomsday scenario movies and get their educations there every year. I'm sure they are aware but maybe apathetic they better wake up if not for themselves for their future generations.
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I agree with you before the idea was about Governments being an old antiquated form of public management.
Before the talk was about Corporations replacing governments. All Walmart associates would be governed by Walmart corporate policies, the same for Ford, and all of the other major corps.
Now networks will replace the government, which in a way makes perfect sense. Do you think DAOs are the organizations to dissolve country borders, one Earth, one people?