The DAO Story

In spite of their name, there’s nothing decentralized or autonomous about DAOs. I don’t mean that as a criticism, but simply as an observation.

The Criticism

As a criticism I would point out that the DAO technology is an automated investment platform meant to make creating money-first organizations more efficient. As such, it is a technology that would do nothing but expand Fiat investment options.

Financial Investments

Financial investment has progressed from royalty, to wealthy patrons, to banks, to VCs: DAO is simply the next step in that progression. But the technology promises to do nothing towards making ourselves and the world we live in a healthier place for us. It is still grounded on the same principles of force and fear, I have the capital, I am the boss. What it brings into the picture is a frictionless way for what VCs call limited partners (LPs): more of them can enter at any capital amount. Great, more capitalists which should give way to more entrepreneurs.

Not bad if you want to see the Fiat system continue on its path to more fear, more domination, more force, and a bigger wealth gap with fewer and fewer at the top.

The DAO technology will make Fiat worse.

DAOs Are Not Decentralized

DAOs^∇ are more or less centralized depending on its governance model, but they are not decentralized and there’s no technology to decentralize them. More LPs (ie, Limited Partners to a Venture Capital fund) and different kinds of friction does not equal decentralization. Sure, LPs have the choice of not joining the DAO or, depending on the governance model, bailing out, but that’s not a solution but an investment.

Our big problem is the “because I say so”, Fiat ways of doing things. We need a truly decentralized alternative to it.

DAOs Are Not Autonomous

DAOs are not autonomous just because they are run from code. In fact, they are governed by committees of people. Even if those could be eliminated, their code itself is created by people. In any case, autonomy is the domain of people. We need autonomous collaboration among people. And people collaborate via conversations.

DAOs are basically an automated investment platform, but, instead, we need a conversation platform supported by all the Web3 technology that does not yet exist.^∇

What Do DAOs Have to Do with Fear?

I have been bringing up “violence,” “force,” and “fear,” without any explanation at all. I’d like to do that now.

Threats and fear are so prevalent in our Fiat world that it mostly goes unnoticed. At least, it goes unnoticed by our cognitive system, but the rest of our body is affected by it and not in a good, healthy way.

You work for your boss. The work you do goes to meet his goals, which were imposed on him by a higher boss. If something goes wrong, it is your fault; you may even feel bad that he is going to look bad to his boss. If it goes really bad, you may end up being fired from your job and there goes your livelihood. Even if you are not worried about finding another job, very few people enjoy the interview process that follows where you have to convince people at the other side of the table that you are going to definitely meet their goals. Or else…

Your goals are handed down to you, possibly by well-meaning, polite people, but they are nevertheless handed down to you. You may make a few adjustments to a goal, but, generally, there is no discussion as to what it is for, why it has to be done, or when and how to get it done. You don’t even think of asking these questions “at work.” You may feel it is not your place, or your boss is going to get upset if you ask, and who are you to ask? Behind it all fear modulates what you say, when you say it, to whom. Fear that you’ll get penalized, even fired. Fear of upsetting your boss. Fear that your boss, and many of your peers, will think badly of you.

There are, of course, healthy fears, the kind that keep you alive and away from the tiger’s jaws. The unhealthy fears come from people who can hurt you. We conflate healthy and unhealthy fears. We don’t ask clarifying questions. We don’t express what we feel. And our bodies notice and react to unhealthy fears in unhealthy, chronic ways.

You might be thinking, But that’s the way it is. You have to learn to restrain yourself and be polite about what you say and how you say. Otherwise, we will end up like animals, hurting each other. Think of it this way: as a species, we are pretty successful. Social animals collaborate among themselves, they do not compete, and that’s what’s made us successful as a species. Perhaps we should behave more like the social animals we are.

Threats and fear are holding us back.

ENDNOTES

• David Rosenthal. EE380 Talk. Feb 9, 2022.

• E. Glen Weyl, Puja Ohlhaver, Vitalik Buterin. Decentralized Society: Finding Web3’s Soul <https://radicals.world/NsThU3>. 11 May 2022.