[[Blockchain MOC]] # DAO MOC --- A research page for **d**istributed **a**utonomous **o**rganizations. Enjoy this research? Drop an eth tip to kylestratis.eth - [[#DAO Stacks|DAO Stacks]] - [[#Primitives (Level 1 Tools)|Primitives (Level 1 Tools)]] - [[#Level 2 Toolkits|Level 2 Toolkits]] - [[#Member management tools|Member management tools]] - [[#Community Tools|Community Tools]] - [[#Useful tools I haven't seen common in the wild|Useful tools I haven't seen common in the wild]] - [[#Problems/Opportunities|Problems/Opportunities]] - [[#Organization Styles|Organization Styles]] - [[#Purpose|Purpose]] - [[#Voting|Voting]] - [[#Compensation and Work Allocation|Compensation and Work Allocation]] - [[#Escrow|Escrow]] - [[#Fundraising Methods|Fundraising Methods]] - [[#Proposal Dependencies|Proposal Dependencies]] - [[#Existing DAOs|Existing DAOs]] - [[#Observed Weaknesses|Observed Weaknesses]] - [[#Information Overload|Information Overload]] - [[#Reliance on Synchronous Communication|Reliance on Synchronous Communication]] - [[#Core Team Takeovers|Core Team Takeovers]] - [[#Duplicated Work|Duplicated Work]] - [[#What are the Advantages of DAOs Over|What are the Advantages of DAOs Over]] - [[#Co-Ops|Co-Ops]] - [[#Corporations|Corporations]] - [[#Communes|Communes]] - [[#What are the Disadvantages of DAOs Over|What are the Disadvantages of DAOs Over]] - [[#Co-Ops|Co-Ops]] - [[#Corporations|Corporations]] - [[#Communes|Communes]] - [[#Resources|Resources]] - [[#Other Questions to Explore|Other Questions to Explore]] ## DAO Stacks ### Primitives (Level 1 Tools) - ERC20 tokens - Can double as proportional voting (like shares) - Examples: - Friends with Benefits ($FWB) - SharkDAO ($SHARK) - Can cash out via UniSwap, etc. - ERC721 NFT - Can signal art/creator support - Can be built around a creator or group of creators - Examples - NounsDAO - Typically 1 NFT 1 vote - but holding multiple NFTs - Multisig Wallets - Wallets that are signed with multiple private keys. This allows more than one person access to the wallet. [Prevents key person risk](https://www.coindesk.com/tech/2020/11/10/multisignature-wallets-can-keep-your-coins-safer-if-you-use-them-right/). - They can also be used to require some portion of core group access to wallet: ie 2 of 3 signers needed to open a wallet. - [Gnosis safe](https://gnosis-safe.io/) - Smart contracts - Governs transactions, payouts, etc. for the DAO's treasury. ### Level 2 Toolkits These are tools for creating or using DAOs, wrapping up and coordinating the primitives above to form and/or manage DAOs. [Snapshot](https://snapshot.org) - cheap voting off-chain using oracles [DAOhaus](https://app.daohaus.club/) - Spin up DAO, interact, vote, etc. No-code [Colony](https://colony.io/) - No-code toolkit for DAOs. A general purpose framework with common DAO needs, like ownership, structure, etc.l [Juicebox.money](https://juicebox.money) - funding, programmable spending, creates ERC-20 community tokens. No voting/governance, chiefly fundraising. Can be used in conjunction with a voting tool like Snapshot [Tokenwalk](https://www.tokenwalk.org/learn#learn_1) - Framework for building DAOs, using modules that are compatible with its interface, allowing for extensibility. [Parcel](https://parcel.money/) - Treasury management, multisig, yield farming [Zodiac](https://gnosisguild.mirror.xyz/OuhG5s2X5uSVBx1EK4tKPhnUc91Wh9YM0fwSnC8UNcg) - Composable gnosis multisig wallet management tools **Need:** We need to bridge the Level 2 toolkits - which mostly focus on treasury management - with community management tools. DAOstack could be part one of this. ### Member management tools There needs to be much more built if DAOs are to be able to self-organize successfully, whether in traditional ways or new ones. [rafa0 has some ideas here](https://twitter.com/rafathebuilder/status/1443157780374896648?s=20). Major themes: - Multi-DAO monitoring - Squad (internal) coordination. While this refers to squads within the DAO, these tools will likewise be needed at the whole-DAO level. - Workbench - collaborative tools for thought, as they mature, will be crucial here. - Payments - General admin - Community engagement ### Community Tools [[Create RoamLab]] can help here. - Workbench - Roam/Notion/etc. - Asynchronous communicator - Synchronous communicator - Scheduler [Discord](https://discord.com) - common complaint is that it's hard to keep up with. Very few DAOs have asynchronous tools [Guild.xyz](https://twitter.com/guildxyz) - token to gate Discord channels [Collab.land](https://collab.land) - tools for creating token-focused communities [Mirror.xyz](https://mirror.xyz) - just opened to the public - Otherwise, can make a simple start page via [Carrd](https://carrd.co), [Webflow](https://Webflow.com), or your favorite one-page service [PartyBid](https://www.partybid.app/) - collective NFT voting [MintGate](https://www.mintgate.app/) - token-based gating of content #### Useful tools I haven't seen common in the wild - [Notion](https://notion.so) - workspace - [Circle](https://circle.so) - asynchronous communication - [Discourse](https://discourse.org) - asynchronous communication #### Problems/Opportunities - These tools are largely centralized. Opportunity for decentralized competitors? Are decentralized versions possible/needed? - Many challenges around compensation: - Work allocation/selection - Resource (compensation) allocation decisions - Fully automated - Done by DAO or squad + 3rd party? - Governance around allocation - See [[#Compensation and Work Allocation]] - HR tooling for digital natives - CRM+ - Taxation? Difficult because it's so murky. ## Organization Styles - Public corporation - using membership tokens like shares, given voting power proportional to the total number of tokens held. Managers or top holders decide on how to raise funds, rest of members go with it. - Syndic - modeled after the syndicates found in The Dispossesed. People come together voluntarily to work on projects toward some goal, with autonomy on teams within the Syndic and the Syndic as a whole - exceptions for "emergencies" that need all hands on deck. Similar to [RoamLab](https://roamlab.org). DAO functions as workspace toward some stated end. - Guildhall - Bounties posted from members and 3rd parties for non-DAO work, and individuals or teams can claim them. The organization itself can draft proposals and vote on which ones to bring up. **Note:** every style will end up needing administrators who are paid for running all the software, keeping track of members, etc. - operations work. ### Purpose - Finding/collecting 3rd party work for members (Guildhall) - [Fundraising](https://medium.com/@bizzer/why-fundraising-daos-will-revolutionize-the-investment-industry-460b20645461) - Community for its own sake - Directing/organizing work in some field - Education - DevRel - Research ### Voting 1 NFT : 1 person's vote 1 ERC-20 Token : 1 vote (results proportional to total available tokens) [Quadratic voting](https://en.wikipedia.org/wiki/Quadratic_voting) ### Compensation and Work Allocation Again, [rafa0 outlines methods and intricacies around compensation](https://twitter.com/rafathebuilder/status/1443269178404786186). Along with compensation, a fair way to claim or allocate (whether a bottom-up organization or a top-down organization, respectively) work. [Compensation framework by Raid Guild](https://docs.google.com/spreadsheets/d/1hy9D4f_nX79d9MXmZQlCZiAnSDViJOVugzLVYb7BFuk/edit#gid=1877387345) #### Escrow [Raid Guild Escrow system](https://handbook.raidguild.org/docs/how-does-it-work) ### Fundraising Methods - Sales of DAO tokens - Sell NFTs that confer membership - Paid work as part of the DAO ### Proposal Dependencies Proposals may have dependencies on other proposals that are being voted on. They should be clearly defined and pointed out in the proposal, and the vote on a proposal with a dependency that fails should be halted and reworked to cut out the nixed dependency. ## Existing DAOs - [MolochDAO](https://github.com/MolochVentures/Whitepaper/blob/master/Whitepaper.pdf) - [RaidGuild](https://www.raidguild.org/) - [SharkDAO](https://twitter.com/sharkdao) - [NounsDAO](https://nouns.wtf) ## Observed Weaknesses DAOs are beginning to run into some similar organization problems that previous iterations of human organization have run into in the past. These are good opportunities for building better tooling and systematizing culture. Many of these problems are related and difficult to solve short of limiting DAO size. ### Information Overload Information overload is tightly coupled with most DAOs' [[#Reliance on Synchronous Communication]]. For large DAOs, just keeping up with projects, proposals, news, and more can be a day job all by itself! Unchecked, this can lead to a concentration of power (by outsized activity) by those with the time to only focus on the DAO. This is a consequence of misaligned incentives: consider a DAO based on ongoing professional experience, those most active are least likely to also work in that profession. Potential solutions here mirror [[#Reliance on Synchronous Communication|those below]], but more radical rethinking of the organization itself could also address this (e.g. stricter group silos and limited inter-group communication, a la [this article](https://www.calnewport.com/blog/2020/08/05/on-the-subtle-network-science-of-optimal-office-communication/)). ### Reliance on Synchronous Communication Most DAOs use Discord and voice chats as an essential part of their stack. As a DAO grows and becomes more active, simply keeping up with all work happening and decisions being made can be a full-time job (as described in [[#Information Overload]]). While synchronous communication is great, especially for working groups that are actively working on something, they are terrible for longer-term discussion and information archival. Some solutions that have been explored included Notion, Discourse forums, and newsletters. These are all important tools and serve specific purposes: Notion for internal knowldege management, Discourse for proposals and discussions on them, and newsletters to highlight recent work done. These tools must be **referenceable**: able to be shared with other users to get them up to speed on a project or proposal, fill out knowledge gaps, and more. ### Core Team Takeovers In large DAOs, people will often vote for proposals promoted by a core group, someone with a sufficiently large "fan following," one of the founders of the DAO, etc. This leads to proposals gaining support by default, despite any ongoing discussion. In any sort of voting system, there's a requirement of skin in the game and education. When there's an [[DAO MOC#Information Overload | information overload]], it's much easier to delegate to people with an air of trust or authority. This enables core groups with the most time and/or resources on their hand to essentially take over a DAO and entrench their power. A core group isn't necessarily a bad thing, and can be a good thing. Many organizations have a [steering committee](https://www.plutora.com/blog/steering-committee), such as the [Python Software Foundation](python.org/psf/) that guide that organization and its goals. This is useful for less democratic DAOs, while DAOs that run more like a public corporation set up a low-trust (ideally) relationship between the steering group and the rest of the voting members given the power differential. ### Duplicated Work In a large DAO, one hand may not know what another is doing. Having various levels of organization (like guilds within a DAO, and project teams within the guilds) can help mitigate this issue, especially when projects are clearly under the purview of a guild. But is this truly an issue? While duplicated work may take talented hands from other projects, competition between two implementations may result in a stronger 'winner' or a merged result with the best of both worlds. This can work especially well for code projects and tooling, while projects that cost money or require high levels of contribution aren't suited to duplicated work. ## What are the Advantages of DAOs Over ### Co-Ops ### Corporations ### Communes ## What are the Disadvantages of DAOs Over ### Co-Ops ### Corporations ### Communes ## Resources [How LionDAO created their DAO](https://blockchain.mirror.xyz/) [RaidGuild Handbook](https://handbook.raidguild.org/) processes for ## Other Questions to Explore - In what ways can a DAO promote or enforce participation? [[DAO Participation Nudges]] - Should larger DAOs be more modular? Can teams within work best independently to manage information overload? How do DAOs manage intergroup communication? - Can DAOs be fully goverend by a smart contract? i.e. can a smart contract truly act as a contract? - What organization styles benefit from a steering group, and where can it be harmful?