DAO 2.0: Steem Powered
If you want to skip the background and go right to my proposal to build a new DAO powered by Steem, feel free to skip to the paragraph titled "DAO 2.0" near the end.
This is a companion piece to the post titled "DAO Squad (TV Series Concept)"
No DAO Fanboy
I won't pretend I was some evangelist for the DAO. I'm an investor. I was born this way. I develop heuristics, organize them into hierarchies, and apply the resultant framework to different types of information until I find something undervalued which I am able to add value to usually by providing capital. Usually that just means buying some kind of certificate of ownership. I could buy stock, which is a certificate of ownership in a company, or I could buy a deed, which is a certificate of ownership in real estate. Of course, there are countless more ways to invest, but these were my personal favorites. Stocks are liquid and real estate is stable.
And then Bitcoin was invented
by some mysterious-borderline-mythical anonymous individual. I tried mining it when it was a whopping $9 a coin. Running full steam all night the GPU (which I had specifically bought for mining and adapted to run externally on my laptop) managed to squeeze out some minuscule fraction-of-a-fraction of bitcoin. I figured I'd probably spent at least that much on energy and taken months off the life of my machine. Clearly this fake money was over-valued. After all, at 900% above the price of the dollar, this had to be a bubble.
Failing to recognize bitcoin as a good investment is one of my greatest ... well "regret" isn't quite the right word, perhaps "embarrassment" is more appropriate. I failed to appreciate the dream behind bitcoin. The ideology. I got wrapped up in the technical sophistication of the cryptography, the almost magical conversion of code into currency, and ignored the ambition of it all. Ambition is one of my most important metrics for evaluating an investment. The bigger the ambition, the bigger the potential impact, the bigger the potential size, and the bigger the potential prize.
I'm not too hard on myself though because I've also learned that sometimes it also pays to wait. The DAO seemed interesting. And ambitious. But one had to deduce the ambition. Visit the site and you see obtuse slogans. "The DAO is revolutionary. The DAO is autonomous. The DAO is code."
The DAO is confusing
There's a lot about what the DAO will be. It will be the "center of many economies..." What the hell does that mean? What is it?!
I suppose that is part of the fun of it. It is whatever the stakeholders want it to be. This is the kind of logic that can appeal to an engineer. But ordinary people need more. We need some guidance, some vision. We need to see potential futures.
Maybe they didn't know what they had
Supposedly one of the sources of trouble for the DAO was that its creators never expected it to reach the scale it did. This makes sense. I remember hearing Max Keiser brag that some small village in Africa used something like $100 worth of his cryptocurrency to fund some project. He has a decent sized audience and he was clearly struggling to get anyone interested in his crypto. With a million crypto-related projects out there competing for everyone's attention, it would seem the people behind the DAO kind of just "threw it out there" with relatively low expectations.
If I had to guess, I would say this had a lot to do with why I never invested. I never saw how the amount I was contributing would return sufficient value to me. Don't get me wrong, I don't need to make a profit. Getting pleasure out of being involved with an ambitious project, perhaps one that is doing some kind of good, can be more than sufficient. But I suppose they were stuck in a catch-22. The whole point of the project was that it wasn't influenced by any single person, there was no predetermined mission muddying the waters.
DAO 2.0
I effectively decided I would wait for some other iteration. I wanted to participate, but I just didn't see any chance at a potential windfall. The odds of an unforeseeable catastrophic event seemed higher than the odds of an unforeseeable miraculous event. I'm a weird guy with unusual taste, the odds of me having much in common with the other stakeholder's didn't seem high. And then, of course, the DAO went bankrupt by faithfully executing its code.
Fast Forward to Present
I'm lying in bed brainstorming about an idea for a TV series I recently had. You can check out the concept here. It's basically Charlie's Angels except "Charlie" is replaced by the DAO, and the Angels are free to do whatever they wish with $100 million... And they're all men (so far, so please help suggest potential female characters).
Whilst exploring this idea, I was struck by the thought, "You know, it's such a shame about the DAO, it really had so much potential. Who knows what it could have done? Arguably no organization like that has ever existed before! An idea like mine actually could have really happened! Then it struck me. Now that the first iteration of that concept has come and gone, in the process revealing both its strengths and weaknesses, why not use Steem to create the sequel? According to @dantheman's post (which I am in no way doubting) he saw issues with the DAO coming, presumably he could help design a better one?
Expanding Steemit's Reach
There is clearly huge demand for projects like the DAO. They were able to get overfunded despite a fatal flaw in their code (not technically a bug) and despite terrible copy, an unclear mission, and zero marketing acumen. Steemit seems primed to take advantage of their failure.
Synergy
Were Steemians to start their own DAO we would already have a pool of people capable of building it, funding it, and promoting it. As Steemit is already growing rapidly, this growth could be used to fuel the DAO 2.0 as well which could potentially create a positive feedback loop. The DAO would give Steemians even more reason to promote Steemit as well as contribute to it, and anyone interested in the DAO 2.0 would be easy to convert into a steemit user as well. Of course, it would also create an additional use for Steem, which should increase its value.
The Name
While it might be tempting to consider ditching the "DAO" monicker, I think this would be a big mistake. The DAO is getting a lot of press right now and leveraging that would be ideal. I think the best strategy would effectively be, "Yeah we know a similar thing collapsed, *we're so confident our version will be secure, we'll even keep the name." It's not the DAO, it's
The DAO 2.0: Powered By Steemit
If you like this idea, you might like the companion piece titled "DAO Squad (TV Series Concept)"
Written with StackEdit.
I like the concept but I see two major obstacles:
Steem market cap needs to be much higher before we even consider doing it - after all a DAO is not about crowdfunding but about spending funds already collected. The market cap needs to be strong enough to counteract the selling pressure created by the process od converting Steem shares into investment funds.
Most of Steem exists as Steem power, so it's not liquid and cannot be easily converted into funds for start-ups.
That's a very good point. I didn't think about that. The Ether allocated to the DAO was a small percentage of total Ether. Maybe there's a way to implement which negates these issues?
This really stood out to me:
I love that perspective: the value of the vision, the dream, the ambition.
I've found that the bulk of the talk in the cryptocurrency communities and news is focused around the technical & financial - whereas what does that matter at the end of the day? Really, the bigger picture is about - and the greater inspiration comes from - what kind of social benefit will these developments create? how will this impact humanity, society, culture, and their evolution?
The DAO may have been a stepping stone. All first attempts are likely to fail, but surely enough, there are ALOT of lessons in this first fall - and a lot who are ready to get back up and build v2.0 better, stronger, and more likely to succeed...Thanks! Yeah this is somewhat of an economic theory I am working on. Schumpeter pioneered a view of the economy wherein new innovations come together to create a new technology which unleashes a new universe of products and services, which leads to a boom in economic growth. However, what he failed to take into account was the vital role that story plays. I do not believe the Age of the Automobile would have occurred without the Model T and the story Ford told in order to sell it. He created a vision that people could voluntarily join based on their desire to live in a "better" world. Products and services which create a lot of value by increasing productivity are important, but a story/vision/ambition is also necessary to push it to the next level.