DAOstack: The future of Decentralized Autonomous Organizations
A new era of positive change swept in with the creation of bitcoin in 2009. It didn't stop there. We progressed and moved on from just financial applications to deployment of Decentralized Apps (DApps) on the Ethereum blockchain.
With these in place, a key part of this whole new system was still missing; governance.
It's been a bit of a puzzle. A rubrics cube, if you will. How can governance be handled, without shifting back towards centralized solutions? How can choices be made by a select few, that reflects the choices of just about everyone?!
These are questions DAOstack is looking to answer.
Decentralized Autonomous Organizations(DAO’s) rely on smart contracts or pre-programmed rules that lay out what can and cannot happen within a system. DAO’s are entities that function via rules encoded as smart contracts.
They have the ability to scale up fast, and do so efficiently.
It’s erroneous to think that the blockchain or decentralized ecosystems built on it are laissez-faire channels, where everyone can just do just about anything and get away with it.
DAOstack hopes to solve the issue of governance, by being the foundation block on which multitudes of DAO’s, working together can thrive.
The agency is the basic unit of governance over the blockchain.
For agencies or smart companies to function, they need a set of rules embedded into their smart contracts.
There are a number of concerns shared about the simple blockchain governance. Issues such as the integrity of the people voting on behalf of the majority, the difficulty associated with recruiting a majority to vote in favor of a proposal, and also a scenario where attacks >50% of it’s value, opens up the ecosystem, leading to it getting corrupted.
Reputation Scores
One way of tackling these concerns is via the introduction of a Rating system. Reputation scores can be a means to an end. Depending on the level at which decisions need to be made, votes can be made on proposals, and voters having higher Reputation Scores will carry more weight. This is why Reputation Scores are non-transferable.
Some task/decisions to be made can be left to the smaller DAO’s. It all depends on the organization's needs, and the level of importance attached to the task.
This solves most of the problems within the blockchain governance, but on it’s own, it’s not entirely sufficient.
This is why DAOstack came up with some tools that would be of great help in handling governance on the blockchain.
ARC
Arc is a solidity framework that is built on Ethereum. It is the base on which everything is stacked. It is a library of smart contracts, and users can carry out a mixture of activities to achieve desired outputs (complete governance protocol). The advantage Arc presents is that it is scalable and highly efficient.
Arc.js
With the help of Arc.js, collaborating developers building within the framework would not need to be familiar with Solidity. It makes the process easier by bypassing the need to be familiar with it. This also enables organizations to build the type of Interface they desire.
Arc.Hives
ArcHives help with identities around the ecosystem. They are the record keeping aspect of the framework. Data can be called up from within, whenever needed.
Alchemy
It's an interface for budgeting and allocating resources for decentralized organizations within the ecosystem. With this tool, creating a DAO is just a few clicks away.
DApps
This is what regular users on DAOstack would interact with, and it is also the final product created as a result of making use of the resources provided by DAOstack. The more the merrier it is, with regards to DApps deployed in the ecosystem.
GEN Tokens
Rewards for contribution on the ecosystem would naturally be done with the help of a token.
Incentivising contributions would be done through the DOAstack framework. For internal transactions, the ecosystem is most likely to make use of DAO tokens. However, for inter-DAO transactions/activities, the GEN token would be made use of. Proposals can also be pushed up or promoted, using GENs.
Open-source developers came together to try to collaborate and create a new chat messenger named WakaBuzz, as there was a lot of dissatisfaction with regards to the options available at the time. Coordinating hundreds of developers in different regions of the world was a huge task and nearly impossible. So to be more efficient and effective, developers of WakaBuzz decided to move to DAOstack.
Being on a DAO offered them lots of benefits, such as overhead savings. Seeing communication is more streamlined, they can coordinate activities on the DAO, and some other activities can also be assigned to sub-DAO’s.
Developers were able to vote seamlessly on proposals submitted about features to be added, and what not to be. Seeing power is more evenly distributed on the DAO, individuals taking decisions based on personal interest were not be able to see the desired effect, as compared to if such decisions were taken by a top executive in a traditional setting.
To rewards developers for their contribution, GEN token were used. This was also a source of motivation. It got them working as a collective unit, and they were able to meet set milestones.
Everyone felt valued and also got rewarded for actions carried out, creating the desired end results.
Shifting from a traditional setting to a DAO would be of immense benefit to organizations in a host of sectors. Having the resources to take on huge projects can only be possible for large corporations, but when it is transferred to a DAO, scaling issues for smaller organizations are better handled.
Rules that guide how an organization should function are turned into protocols, thus becoming automatic functions. They can also be upgraded as a whole, or parts that need to updated are carried out separately. This of course, is done faster and at a lesser cost, when compared to traditional organizations.
The need for law firms, accountants, expensive software to keep businesses going will also be rendered redundant.
I believe that the concept of DAO’s could be applied to any organization that decisions need to be made in, and they hope it reflects the choice of the people. It could even be applied to Non-governmental organizations.
Getting a lot of people to work together on projects can be difficult and expensive, as a result of the paperwork involved, legal teams to pay and third party software licenses to pay for. These are issues faced by a lot of organizations around the world. Moving to DAOstack would take away these hassles and make the organization more profitable, seeing they would making huge savings. Their profits will also skyrocket, and their outputs will be on the increase, seeing they are working more efficiently.
Creating a foundation where everyone truly feels part of something beautiful fosters inclusion, and the power of the collective is harnessed for the greater good of the group.
DAO’s are a fairly new concept, and might take a bit of time to catch on, but it’s only foolish to see a better way of doing things and turning a blind eye. This could just be the future…..and also the present.
Matan Field, CEO & Architect
Leading expert in decentralized governance. PhD in Physics. DAO architect and blockchain entrepreneur since 2014.
Nathalia Scherer, Community & Biz Dev.
Culture and living systems catalyst. Dalai Lama Fellow and Systems Engineer with a focus on social innovation and complex problem-solving. Artist, complexity geek, and aspiring paraglider pilot.
Adam Levi. CTO/Technology
Deep Blockchain technologist. PhD in physics from the Technion. Former IDF radar engineer. Twenty-two years writing code.
Josh Zemel, Communications
Designed and executed major growth initiatives for Equifax, Blue Cross, Blue Shield, and Toyota. Former VP at IMM, a digital agency.
To learn more about DAOstack, kindly visit the website here
DAOstack's WhitePaper can be found here
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DAOstack can be found on Github, here
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