Closing Story - Decentralized Autonomous Organizations (DAOs)

A DAO is Autonomy taken to the fullest extent. DAOs are decentralized autonomous organizations: entities created according to rules encoded in a transparent computer program and controlled by the organization’s members. In other words, DAOs have no central leadership but are run by their members. Anyone can launch any model into the decentralized environment, letting the marketplace decide who will participate. Even their finances and rules are maintained on a blockchain. DAOs function, essentially, as co-ops running on a blockchain with smart contracts—Interfaces—codifying their internal operating rules. These interface-enabled DAOs are the reason why the Web3 world can scale so quickly.

Because anyone can participate, DAOs can recruit the most interested and talented parties. Consider Braintrust, which bills itself as “the first user-owned talent network.” Users join Braintrust by creating a Braintrust profile listing their background and experience. Upon approval, members are invited to add a portfolio and information about their skill sets and work history. In theory, becoming a member of the Braintrust DAO accelerates your career as you get matched to jobs with the world’s most innovative companies. Meanwhile, the site lets you set your own rates and get 100% of the fee. Clients pay a 10% platform fee, on top of the freelancer’s rate, to Braintrust. Freelancers set their own payment terms.

Braintrust is a glimpse of how near-perfect Autonomy can be brought to the jobs market by giving job searchers complete control over the process. In a gig economy, where freelancers will begin to dominate the marketplace, ExOs will need to become skilled at navigating and taking advantage of the Braintrusts of the world to locate and recruit the kind of top talent they will need to succeed.

DeFi (or “decentralized finance”) is one of the most interesting subspecies of DAOs. DeFi is an umbrella term for financial services on public blockchains, usually founded on Ethereum. As with most crypto, DeFi is global, peer-to-peer, pseudonymous, and open to all. 

Consumers can use DeFi for most traditional banking services and functions: borrowing, lending, earning interest, trading derivatives and assets, and even buying insurance. DeFi, however, is much, much faster than traditional banking—not least because it doesn’t require paperwork. Examples of DeFi entities on Ethereum include:

• Uniswap, the largest decentralized exchange on Ethereum

• Maker, the governance mechanism for the Dai stablecoin, and

• Aave, a lending platform to trustlessly lend and borrow major assets.

“Grants” DAOs are designed to fund new ventures, typically in the DeFi space. They include:

• Gitcoin, which funds developers of open-source applications

• MolochDAO, which provides a transparent and efficient funding mechanism for Ethereum projects

• “Collector” DAOs that pool funds to purchase collectors’ items such as NFTs, artwork, and music 

• Flamingo, which focuses on purchasing NFTs for investment, and

• PleasrDAO, an omnibus DAO that pools funds to buy any type of collectible or artwork.

• “Social” DAOs often require membership fees, paid in DAO tokens. Social DAOs are often famous and exclusive and are typically based on common interests. Two examples are:

• Friends with Benefits, a very exclusive DAO largely composed of Web3 artists and followers.

• Bored Ape Yacht Club, a DAO popular with celebrities. Membership requires you to own a unique “Bored Ape” NFT.**