Decentralized Autonomous Organizations

Decentralized autonomous organizations (DAOs) are digital, global, distributed organizations that enable like-minded individuals to achieve common goals through shared funding. DAOs are typically based around the use of digital tokens*, which verify identity through ownership and regulate access and agency within the ecosystem. These organizations are stakeholder-driven, meaning that participants at all levels possess voting rights to democratically direct the organization’s mission and progress. It is a method of organization that facilitates self-change, empowering those doing the work to prioritize the benefit of the communities they serve instead of the profits of a small group of shareholders. 

Decentralized autonomous organizations provide an organizational structure that mitigates and eliminates traditional power dynamics from governance by prioritizing inputs of focus and energy over capital. They can be organized as one person, one vote, or weighted voting based on contribution and expertise. They facilitate cooperation through collective ownership, which is why they are ideal for global public works like the eight dignities. DAOs exist on the blockchain, providing transparency in nearly all aspects of their operation—a vital component when considering the development of global public works. Much of their operational rules are facilitated by smart contracts, allowing for higher degrees of automation of the permissions and processes within an organization. Ethereum creator Vitalik Buterin describes a DAO as an “entity that lives on the internet and exists autonomously, but also heavily relies on hiring individuals to perform certain tasks that the automaton itself cannot do.”

Compared to traditional systems developers like the corporation or the state, DAOs reject centralized leadership structures in favor of ground-up decision-making. As opposed to the invite-only approach to corporations and the state, DAOs have low barriers to entry that provide pathways toward participation for those wanting to become involved. This allows for the easy attraction of new members while removing opportunities for nepotism, favoritism, and corruption common in hierarchical organizations. DAOs generate surpluses through transactions of goods and services but redistribute those into continuous exploration, experimentation, and the shared benefit of those working to support them. In this way, they perpetually improve, free from the burdens of profitable quarters and market manipulation. Ultimately, DAOs are communities. People of like-minded interests come together to solve problems for their collective benefit. Through the lens of self-actualization in the age of crisis, DAOs provide a vehicle to build collectively owned systems of utility and self-empowerment. Whereas technical innovation typically automates the peripherals of a process, DAOs automate much of the center. The DAO dares to address a challenge that social democracies around the world have failed to solve: how to experiment with fundamental systems governing economic centralization. They provide a pathway to the decentralized access to productive resources and opportunities necessary to develop economies in support of systemic actualization.

Our struggle to overcome the crisis is rooted in the fact that the presently available options for legally organizing groups are all hierarchical, reinforcing that which we seek to transcend. DAOs provide humanity alternatives that may be applied to systems ranging from local to global, each empowering the individuals inhabiting them in various directions presently unavailable. Systemic actualization is the process of leveraging our creations to elevate individual and collective human consciousness. We undertake this journey knowing that there will be a moment in our not-too-distant future where a threshold is crossed, and humanity inhabits a state where it can most fully unleash its collective imagination upon the universe; a world where each possesses access to the systems necessary to develop and harness their agency. Where every individual is born a stakeholder rather than a cog in a crumbling machine. With the appropriate amount of focus, energy, and resources, it could be complete within a generation. What matters most is our choice to change the direction of our focus and energy in alignment with the single truth. Step by step, we build a more expansive expression of divinity within the moment. 

Another hurdle DAOs overcome is the traditional interview process typical in hierarchical organizations. Interviews test your personality, skills, and knowledge, culminating in a handful of people deciding whether you meet their definitions of a good fit. The DAO primarily rewards time and effort. If you are interested in contributing, you join the community, review their bounty (task) boards, and find a problem to solve. If no requested tasks fit your specific skill set, options exist to either petition for an alternative direction that may be better aligned with personal knowledge or connect with the community to better understand shared needs and direct focus and energy toward learning. In exchange for this proactive engagement, the individual receives some form of stakeholdership. 

What form these rewards take may vary, but present examples include interorganizational currency or tokens representing effort and accomplishment within a specific vertical. This shift in accreditation and demonstration of contribution rapidly accelerates more people into the knowledge economy. Advanced education will also be represented by tokens, and the average degree will matter significantly less for most undertakings than dedicating the time and focus on learning and understanding something new. Through this process, the best DAOs become the best schools. We can imagine that future position applications will eliminate the use of résumés as a recruitment tool, instead relying solely on the tokenized credentials an individual accrues throughout their journey. This also solves a significant challenge in creating a global reputation system. Present social credit models are inadequate and often used as a means of punishment. A systemically actualized society requires that we be able to accurately identify an individual and their competencies, especially in a world of anonymous identities. There is no greater test of reputation than how you have served others and no more verifiable way to assign personal and professional accolades than non-fungible tokens. 

The directions of development a DAO may take are limitless. Each leverage the collective imagination of all active participants, embracing a system of leadership that prioritizes those who know what to do next over individuals with specific titles. Depending on the organization’s mission, there are various methods as to how to ideally structure their directional determination. That all are stakeholders means that each has a vote but does not necessarily mean that all votes are equal. The value of the individual vote can be organization-dependent. Consider first that voting within a DAO is not voting for a president in a corporate-sponsored election. No one is stuck powerless in a circumstance they do not want. If a significant number of members are unhappy with the outcome of a vote, they are free to independently organize toward their preferred direction without repercussion. Organizations will have central missions and charters that shape frameworks of action, so the degrees that one can deviate from the objectives may vary. However, the beauty of a DAO is that it presents opportunities to spin off in entirely different directions and rules toward a shared vision of the good. With that said, building a DAO from the ground up is challenging from the onset, given the amount of coordination necessary. One observable alternative is a hybrid model of a central team governed by stakeholder direction. A formally organized central unit allows for speed, efficiencies, and more effective stakeholder communications, all while retaining community control in the direction of the organization’s focus and energy. The objective is to be fully decentralized once the community evolves the capacity to operate without a central team.

Consider the DAO through the lens of global public infrastructure. They will each produce, manage, and distribute several resources and benefits, providing streams of education, productivity, and participation for individuals across the world. Each will require varying degrees of expertise and perspective. Specific DAO charters will determine the types of voting schemes that best fulfill their missions. My perspective is that the ideal arrangement for most organizations lies in weighted voting that prioritizes contribution and expertise. Consider transportation. Pilots, aircraft engineers, airport/airplane staff, and the many other stakeholders involved with the daily and long-term operations of managing air travel would earn a higher degree of authority than others without a vested interest in the vertical. This doesn’t exclude noncontributors from engaging with the progression of these verticals through suggestion, debate, and voting, but it does reward those dedicating focus and energy to the public good. We can imagine systems where a small weight is added to a vote; for example, votes ranging from 1.1–1.5. This way, the individual has no personal power to dominate a decision, but when the directors of progress reach consensus, it holds weight beyond those without vested interest. There is no limit to how votes might be weighted, allowing for circumstances requiring or organizations preferring strict chains of command. Another, more complex option is holographic consensus voting. It ties voting to a prediction model where people essentially stake funds for or against proposals according to what they believe the outcomes will be. Correct predictions produce financial rewards; incorrect predictions result in losses. This helps prevent ill-intentioned proposals because it becomes “expensive” to lose often. After a certain threshold is passed within the prediction models, the vote switches to a relative majority process focusing on “for” and “against” votes. Alternatively, there is always the option for stakeholders to delegate votes, which is popular in existing DAOs today. In these scenarios, one token equals one vote, but you can delegate the voting rights of your tokens to an individual or group who the individual believes represents their best interests. While defining stakeholdership is an important example, there is no limit to how we might organize ourselves within DAOs. Fortunately, there are many great examples to learn from. 

Note that DAOs that incorporate today are limited to the available corporation types, despite operating in very different ways. The distributed organization of an agenda should be able to leverage legal structures designed for its operation, just as the hierarchical design of present-day corporations benefits from their specific classification. Considering the scope of global public works DAOs, new legal classifications provide more efficient and transparent models of operation. To this end, we identify the opportunity for developing new legal syndicates to better support DAO development in all directions. Presently, Wyoming and Tennessee have begun experimenting with alternative legal structures, and we should expect more states to follow. 

Given their relatively recent invention, DAOs will be works of perpetual progress. As self-changing systems, they allow for alterations in the fundamental fabric of their operation. Through this, they empower their stakeholders to meet the needs of the moment without the arbitrary restrictions of what is stifling what will be. There will be many ups and downs during our journey in building these vehicles of progress, but that should not deter us. We direct ourselves to a moment where the birthright of dignity leaves the realm of spiritual philosophy and embodies the reality of systemic outputs. Within the context of global public works, the DAO offers such a path where profiteering off of basic human dignities loses priority over collective well-being. In this work, our spiritual journey is active, and within it our best alternative to avoiding the crisis is made available. The organization of global public works within DAOs also expresses our core values of relation, equity, flexibility, enthusiasm, and courage. System and individual align to create a whole self, capable and unafraid of transforming the world.

* There are several types of tokens used for DAO governance, with ERC-20, ERC-721, and ERC-1155 being the most common. ERC-20 serves as a form of financial security and is regulated as such. ERC-721 is a non-fungible token, which means it cannot be copied. ERC-1155 is ideal for organizations managing multiple token types. ERC-721 and ERC-1155 are not presently considered securities.
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