DAO development and construction must-read articles and in-depth thinking

Original title: "Buidler DAO Locust Selection (11): Must-read articles for the development and construction of DAO"

Original source: Buidler DAO

Article Quick Facts:

01/ Key Lessons Learned About DAOs: Creation, Practice, and Culture @红豆红豆!  

02/ DeWork's largest DAO organization was disbanded, what lessons have we learned? @Frank

03/ The DAO Story - History and Impact   @甲豆甘豉!  

04/ DAO needs a mission, not a CEO @红豆红豆!  

05/ a16z: How to Pick a DAO Legal Entity @纺豆羊豆!  

06/ Is there hope for DAO? —Osaka Devcon Notes @ Spinach Spinach!  

07/ PartyDAO: How does the most valuable community DAO make products? @Tommy

08/ Decentralization of DAO: Bell curve @Tommy

Key Lessons Learned About DAOs: Creation, Practice, and Culture @甲豆红豆!

Decentralized Autonomous Organization (DAO) is a Mission organized groups. DAOs collaborate through a shared set of rules enforced on the blockchain. The DAO itself is just a specific organizational structure, which is used to control the shared economic resources and the agreement rules of the organization, so each DAO operates differently. Some DAOs are closed (Translator's Note: There are strict barriers to entry), while others are open, where anyone can join and contribute. Active contributors in some DAOs can get paid for their work from the DAO.

This article covers some of the author's main takeaways from working with DAOs. Much of this is from the author's experience representing the Gitcoin DAO, but the author has participated in and observed many other DAOs as well. The author believes that there is no perfect DAO structure, because each DAO has its own culture, so what is enshrined in one DAO may not be useful to another DAO. The content in this article reflects the author's personal experience and views, and others may well disagree with me. The entire industry is constantly iterating, trying to figure out what works and what doesn't.

Thinking

The author mentioned that when creating a DAO, you need to consider: clarify the mission of the DAO, and consider gradual decentralization. On the executive level: Smaller working groups are more efficient, explore ways to establish accountability, explore incentive systems, and plan for the long-term sustainability of DAOs. And culturally: Cultivate a culture that feels comfortable saying "no" and having difficult conversations, building structures where members can take breaks, experimenting early. Good article worth reading.

Original link: https://mp.weixin.qq.com/s/TFdr978uKigPtXciMpgpTw< /p>

What lessons have we learned from the disbandment of DeWork's largest DAO organization? @Frank

September 29th, after several rounds of security After the audit, the PandaDAO refund process officially started. Panda mentioned in the article: I think the deeper reason is that this DAO is becoming less and less like a DAO organization, it is more and more like a centralized organization, or more like a Web2 company. Many people are asking for my opinion, asking for my thoughts, and wanting me to make a decision, and everyone is unwilling to pay for the decision they make. PandaDAO's proposal is a review team composed of 14 people to review each proposal. In fact, many DAOs have such a system, because if you have too many proposals, there may be too many voices, and the really useful proposals may be drowned out. However, the review team of PandaDAO may have too few people selected from the community, so the community feels that many voices cannot be heard.

Thinking

Summary the key reasons for dissolution:

1. The repurchase price was set incorrectly, which caused conflicts in the community, and the founding team aroused long-standing anxiety about governance.

2. The overly centralized mechanism makes the founding team gradually uneasy, and there are very few opportunities for community members to really participate in the construction, and they only have speculative appeals to the community. There is no consensus. Stories like this are indeed worthy of vigilance for all DAO members.

The article specifically mentions the decentralized proposal and review mechanism, which actually represents whether It is difficult to talk about the optimal solution to give DAO the promise of waste of resources.

Original link: https://m.theblockbeats.info/news/32073

DAO story history and impact 

One of the most incredible concepts successfully implemented through blockchain technology, It is a decentralized autonomous organization DAO. Decentralized Autonomous Organizations are entities that operate through smart contracts. Its financial transactions and rules are encoded on the blockchain, effectively eliminating the need for a central governing body — hence its descriptions of "decentralized" and "autonomous". Decentralized Autonomous Organizations (DAOs) aim to function like venture capital funds in the crypto and decentralized space. Removing a central authority keeps costs down and theoretically gives investors more control and access.  

In early May 2016, some members of the Ethereum community announced the establishment of The DAO, which also Called Genesis DAO. It is built as a smart contract on the Ethereum blockchain. The coding framework was developed open source by the Slock.It team, but deployed by members of the Ethereum community under the name "The DAO".  

DAO has a creation period during which anyone can send ether to a unique wallet address in exchange for 1-100 DAO Tokens. It was an unexpected success during its creation, as it managed to raise 12.7 million ether (worth about $150 million at the time), making it the largest crowdsale ever. At the time, when ether was trading at $20, the total value of ether from The DAO was over $250 million.  

However, on June 17, 2016, a hacker discovered in the code A loophole that allowed him to withdraw funds from The DAO. In the first few hours of the attack, 3.6 million ETH was stolen, equivalent to $70 million at the time.

Thoughts

Although V God initiated a hard fork after The DAO was attacked to recover the loss, the impact of The DAO on us is still continuing . Current blockchain development teams are constantly looking to The DAO for guidance on what not to do. First, The DAO taught industry folks a valuable lesson in the importance of building a secure blockchain platform. The DAO hack was not due to an inherent problem with the Ethereum blockchain; it came from a coding flaw exploited by a clever hacker. If the code is written correctly, hacks can be avoided.  

Without The DAO, there might be more bitter lessons for us to learn.

DAO needs a mission, not a CEO @纺豆红豉!

Does DAO Still Need a CEO? No! For DAO, what is more important is the mission. No matter how the strategy changes in the process, the mission of DAO remains unchanged. Defining the mission and fulfilling the mission is the only way for every DAO to succeed. The author of this article discusses the method of defining the mission of the DAO, and calls on everyone to act together to define the mission of the DAO in a decentralized way to create a better future. The DAO A few weeks ago, there was a hot topic on Twitter:

“DAO needs a CEO” The tweet reads.  

Reviews were mixed: some strongly objected that a single CEO was too Centralized; others argue that DAOs need more direction, which a centralized leader can provide.  

They are both right. The desire for DAO direction and unity makes sense, as today's DAOs feel exhausted with their disorganization and change. But CEO and decentralization are opposite. If DAO still needs CEO, is it still DAO?  

It seems to me that the tweet could have been written: "DAO should have a clear mission to Guide everyone."

Because we need a little more unity in the DAO, don't we? Everyone who has worked in a DAO has at one point or another lost sight of the North Star that guides them forward. This North Star is the mission.

Thoughts

Failure to set a mission is what hinders the development of DAOs.  

Many DAOs are formed only for "consensus", but they do not define a meaningful A mission cohesive enough to bring everyone together.  

DAO can use the above three strategies to set up in a decentralized manner mission, and then decompose the elements of the strategy into different teams, each with their own way to achieve the mission.  

There is an old saying: one person can go fast, a group of people can go fast farther. ” This also applies to the mission of the DAO. Only with a common mission can DAOs work together to create a better world.

This article is not only a call for everyone to act together, but also a decentralized way for the DAO community to A toolkit for the hard work of defining a mission.

Original link: https://mp.weixin.qq.com/s/PgVguF706t7f1jYaEfk4PQ< /p>

a16z: How to Pick a DAO Legal Entity @甲豆羊豆!

DAO is an important empowerment tool to realize the benefits of Web3, enabling participants in organizations Fairer ownership, less censorship and greater diversity.  

DAO advances the benefits of Web3 by enabling decentralization. This form of organization allows developers to hand over control of developed networks and protocols to users, often through the distribution of governance tokens. This process effectively turns the network and its protocol into a public utility that users can build on top of, knowing that there is no centralized control body that will suddenly change the rules and extract benefits from them.

DAOs are often used to manage treasury used to incentivize continuous development of the network and protocol, thus ensuring the open source and decentralization of Web3 Technology can obtain enough resources to continue to innovate and improve. In addition to network and protocol types, DAO also has the following categories:

For investment Established DAOs, where individuals, friends and colleagues form clubs to invest in Web3 startups

Collector DAOs, dedicated to collecting NFTs

Social DAOs, to convene the Web3 community

p>Collective/cooperative DAOs, in which groups of artists and engineers provide services to other DAOs

Charitable DAOs promote good deeds and public goods The thriving diversity of DAOs demonstrates that communities around the world revolve around shared interests,

The vigorous development of DAOs is the exciting development in the evolution of the Internet The frontier of the human heart, but this phenomenon also raises many legal, tax and operational issues.

As the number of DAOs increases and their internal practices develop, so do the problems: How these organizations exist as legal entities. We started last year with a series of studies on the legal framework of DAOs to help builders, founders, and members evaluate their options in the evolving regulatory environment. A few weeks ago, we published a reference guide to help Web3 builders. In Section 2 we propose a new and practical entity selection framework and conclude that legal entity structures within the United States can bring clear and far-reaching benefits to DAOs, thus benefiting the overall development of Web3 .

Thinking

Formation of DAOs is not an easy task, especially when considering the complexities of coordinating a diverse community. Looking at the world, the lack of clear regulation of Web3 and DAOs makes this problem even more obvious. In the U.S., there has been little legislative action, and agencies like the SEC and IRS have provided no meaningful guidance for Web3 builders. This environment exacerbates uncertainty when choosing a legal entity for a DAO.  

During the short history of DAOs, two entities have been used most often , and neither form is risky. The first is the disembodied form, which in some respects represents the ideal form of decentralization, but it limits the functionality of the operation because it lacks a legal presence, cannot pay taxes, and potentially exposes participants to unlimited liability (or at least is to prevent the establishment of liability in the proceedings). The second is offshore foundations, which can achieve tax advantages by being headquartered outside the United States, but in practice they can be vulnerable to government scrutiny, thus severely undermining their value proposition.

Original link: https://mp.weixin.qq .com/s?__biz=MzI3NDAzMjkwNg==&mid=2648422221&idx=1&sn=1f844a823e5a765ec33ce66b439715db&chksm=f3352728c442ae3e9e08d10ec341d168c8 f08cb5bbcbe24fc1796b0702cec75e08d013d38ce5&cur_album_id=2379390791950696452&scene=190#rd

Is there still hope for DAO? —Osaka Devcon Notes @ Spinach Spinach!

Decentralized autonomous organization started ETH in 2016 Since the development of DAO, it has mainly formed two directions: the underlying protocol/real organization.  

DAO's own governance mechanism design has gone beyond the technical boundaries of the blockchain. And return to thinking about the origin of governance and human organization. Just as the mechanism design of Defi requires a lot of reference to real-world financial models, the same is true for DAO. In terms of the implementation of the DAO mechanism, the forum management mechanism in the Internet age actually provides a very rough prototype: member access, member honor system, member incentive system, and the function and financial nature of member tokens.  

I want to go back to the very beginning of the definition and ask a more basic question: Does the "A" in "DAO" favor autonomous (self-governance) or automatic (automatic)? In Berlin in August, at a round table about DAO, when everyone talked about the ultimate fear of DAO-when the system is too automatic and completely unable to be interfered by humans, someone will definitely use the loopholes in the system to convert huge energy into Weapons, even if the system is an incentive and punishment mechanism based on human design. Because the organization is ultimately composed of people, once there is human interference, any "automatic" will have certain defects.  

How to balance "automatic" and "autonomous" A question that needs to be considered.

Thinking

"Self-governance" is an autonomous organization in a system based on mutual contract, trust, and incentive design within the organization, while "automatic "It means that it can be a rule made by a group of people or a person, and the rules are enforced (enforce) through some automated method (such as smart contracts). The DAO that everyone generally discusses may refer to organizations that have both properties.  

As a matter of fact, human organization has always oscillated between completely democratic and very centralized swing. Can autonomous organizations integrate the strengths of the two, allowing those who are willing to lead to design bottom-level incentives, while allowing those who are only willing to make partial decisions to have voting rights for specific operational affairs at the upper level? This is a question that urgently needs to be considered more deeply.  

The fundamental purpose of DAO is to significantly reduce the cost of organizational collaboration through technology. As a result, a new type of human cooperation model cannot exist under the current boundary condition that the cost of collaboration is less than the value of collaboration.

Original link: https://mp.weixin.qq.com/s/ueG0o3yI5SQ_Xa1pmEyMPA< /p>

PartyDAO: How does the most valuable community DAO make products?  @Tommy

On June 10th, PartyDAO announced that it has received an investment led by A16Z With a financing of US$16.4 million, it has also become the most highly valued community-driven DAO so far with a valuation of US$200 million.  

PartyDAO's story began with a Friday night brainstorm, and its progression The road is an interesting exploration. What can a team with no founders, no financing, and no full-time employees do?  

How can the threshold for public participation be lowered so that the concepts repeatedly emphasized by Web3 can be implemented in real applications?  

Everyone says that DAO is a small group gathered by consensus, the application of DAO Where exactly are the boundaries? With the influx of large VCs, can DAOs still maintain the community spirit?

Thinking

PartyDAO is a community-driven DAO, from a team with no founders, no financing, and no full-time employees to a team led by A16Z $16.4 million in financing. PartyDAO implements a decentralized community-driven paradigm, but full decentralization introduces potential inefficiencies. I personally think that a leader/founding team is needed to set the direction/big framework, so that people in the community can have a common direction to deepen/explore

Complete decentralization is not a good way to quickly develop and iterate products. Therefore, PartyDAO also has relevant authorities to follow up the progress of specific tasks. Among them, John Palmer became the team leader

It is not to let everyone be trapped in a job with a tight timeline, after all, at the beginning, everyone joined because of this It's fun, but when more and more intense tasks are added, it actually goes against the original production motivation and fun.

PartyDAO contributors work sprint-by-sprint, and each sprint lasts about 2-3 months. Compared with the traditional long-term work contract, this gives both parties more flexibility to choose the adjustment mechanism of workload and remuneration. And confirm the budget for payment of remuneration according to the workload and market conditions. Remuneration will be paid every two weeks, and the specific amount will be determined according to the actual amount of work completed in the two weeks.

Original link: https://mp.weixin.qq.com/s/kt_fz0L5lbljD0QxbknLiQ

Determining the degree of decentralization of DAO: the bell curve @Tommy

The life cycle of DAO is divided into 4 stages

Phase 1: When the DAO was born, it became centralized. It is implemented by a few core team members who share a common vision - it goes against the "D" (decentralized) in DAO.

Phase 2: Soon, the DAO starts adding external users - introducing mechanisms like tokens or NFTs to facilitate governance. Tools like Snapshot support free and frequent voting.

Phase 3: Decentralization reaches its peak as working groups are established and power is distributed among larger groups of participants and stakers.

Phase 4: The DAO sets its sights on something higher; more users, better product/UX, or greater wealth. The price for achieving this is often decentralization.

Thinking

I think that the decentralization of DAO should be implemented in stages, and it cannot be fully decentralized from the first stage, and it will be introduced in different stages later More participants and stakers, enabling decentralized decision-making. What's interesting is that MakerDAO is introduced as an example in the article. Taking the Defi protocol with the highest TVL, it is actually quite centralized. With 13 recognized delegates, the top delegate controls 19.7% of the vote. Maker co-founder Rune Christensen is responsible for currently 76% of the voting power. 41% of the total MKR used for voting is dominated by one person. How the degree of decentralization of truly influential projects is determined is really worthy of further verification/exploration.

Original link: https://mp.weixin.qq .com/s/tpkbJZqHfKMKghdQnhnHHQ

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