A Deep Dive into DAO's - Panel featuring Jason Nelson, Sandeep Nailwal, and more...

how's it going everybody so what we're going to talk about today is basically the how to get into a dow how to start a dow because covering dowels you hear a lot about dowels that already exist so what my panel and i plan to discuss is how to do that so that you can get an idea of what goes into it so gentlemen if you would please introduce yourself starting my rate hey guys i'm munir founder of powerswap i'm mostly in charge of product and operations i have a technical background biosub started almost more than two years ago actually and we are a decentralized exchange aggregator running on ethereum with various changes and the second one was polygon hello everyone i am sandeep i'm the founder at one of the co-founders at polygon so dallas have been around for at least six years so when you have someone approach you with bringing it up as like hey what's this thing how do we get into it what's the first thing that you normally tell them in your so we can map dows to existing organizations whether those are foundations and non-profits that have different stakeholders with common interest on making this organization succeed but then it depends on the context what is this now what is it doing the most important part of this dao is this d that is decentralized and not almost but i think it's a spectrum and daos are in still in their early stages even though it's six years ago but we feel like always it's like uh it's like a nascent uh ecosystem or a nasa movement so i guess yes thou are still in their infancy and growing and it's a case-by-case definition what do you think sandy yeah i mean uh i agree to that that uh you know dao's even though we've been toy you know kind of toying with this concept of daos for multiple years now uh but i think only in this year or maybe you know some part of the last year i mean i mean 2021 we saw a lot of dows coming in um i think one of the reasons is also like uh you know if you if you see it on a higher scale um why these dows emerged you know uh in in this high uh kind of velocity is the application layer emerged in 2020 21 only right so before that uh the blockchains were in primarily in the in in the you know infrastructure era like all the protocols that were you know raising money launching projects and all that they were all infrastructure projects but only in 2020 once d5 took off after that nft took off and all that these applications layers started growing and then at the end the idea of this you know the whole web 3 is that the applications in web3 will be owned by community so that's when like i think uh you know the real dows which have a purpose which have some purpose to do which is on chain started emerging and that's why we started seeing so many of of dows and now i think like now we have so many applications in the space uh you know the innovation on the dow tooling and all that is only now catching up to the the amount of demand and uh you know i've been in these conferences for last like you know four or five years and every time like for example in 2020 before everything shut down because of covid i came to eat denver everybody was building d5 d5 d5 d5 d5 and then in 2000 like you know end powder 20 20 20 and early 2009 to 21 every in all the hackathons it was nft nft nft so nft you know picked up then from there and i see now in a lot of hackathons people are doing a lot of stuff around those so i think that you know that inflection point of taos is just around the corner maybe this year next year we'll see a dow summer as we see in crypto like d5 summer nft summer we might have a dow somewhere soon well i think the that comes from situations like constitution dao and now assange dao i mean constitution dao raised 45 million 47 million to buy a copy of the constitution right and you have assange style who raised 43 million i'm sorry 53 million uh free rostow raise millions and it's just the amount of money these groups are able to raise relatively quickly you know that that could have a reason uh for the you know how people are getting really interested in what this is but the next question i have is why form a dow to raise this raise money around something when there's already fundraising platforms out there what do you think is the benefit or why someone would want to do this rather than use what's already available um what i think the first thing that can come to mind is the simplicity for using the ethereum blockchain or any other chain that's running on ethereum uh while using uh those traditional crowdsourcing or crowdfunding platforms require an extra step and an overhead and also like some privacy elements which are native to crypto but also the crypto community has also a good amount of wealth that's been created the last last few years so i i would resume it into efficiency and simplicity and also a large amount of wealth that was created in the ethereum ecosystem and it's very intuitive to raise funds and here we're not raising funds because we're making an investment we're raising funds for a good cause and i think it's a way of giving back what was earned during this last three years i would say um i think like you know first we need to understand like the categories of the dow like right now i think we are only talking about these community dows where communities raising coming together putting funds and then you know they are doing some financial kind of activity like let's say investing in nfts or like this constitution now that you said you know funnily like austin who's the founder of constitution dao he just joined polygon uh with us so we we see this you know dow stuff happening from very close quarters like in fact i myself participated in and bought the the matthew balls the original meta was you know kind of uh essay that he wrote like a long time back to you know kind of start this meta was dao and things like that so uh you know this is one category of dow like i think we need to also see that all the protocols like parasol like the decentralized high quality protocols like europa swap compound uh uni swap they all are also effectively run by dows those are also dows like you you know in in a way these like when you are talking about this raising money and uh you know like the the community does where and and also for profit downs these are also for profit now like some of them uh not many of them are non-profit dows right for-profit dows are basically where communities coming together and they are trying to do some financial activity let's say pleaser dao where you start buying nfts and why it has become so popular right now is that with some of these speed pleaser dao fwb dao and all that right they have been able to you know grow the aum of the nfts they bought by a very large extent and due to that like you know there is more propensity in the market that some of these dows like that can also do really good for their you know dow members and early investors i think that is also resulting in a you know like some of these dows catching a lot of uh community uh kind of attention but of course there is also a purpose like you know as we said that julian assange and constitution dao these are prime examples where communities coming together with some sort of purpose and uh you know and you know there's expectation that this let's say constitution uh now if they've bought the nft of constitution like in future that could have become like really really big and then the dow can also venture into a lot of other things after that like you know maybe they could buy more constitutions from other countries and things like that so there is some financial motivation also from the investors plus of course there is some you know purpose behind these laws well you bring up a good point about uh for-profit dallas because one thing that i've noticed covering dials is that a lot of most of them have a aesthetic a central thing to them like for example spy style was originally called doon dao and the whole point of them was to buy the dune bible alejandro joroski's doing bible right but when you're just based on one thing dun dao constitution now what happened what do you do after that like how do you where do you move on after you've accomplished whatever it is you you're trying to do all right should should dallas be more vague i guess is the question see the fun part about daos is that everything is changeable as per as per community vote so as you said that you know spice or dune dow became spiced out so tao can eventually you know this let's say constitution now they came together to do one particular part but eventually they can easily decide that hey let's rebrand at the end it's a company right running run by individuals and they can decide the future course of doubt what do you think i think yeah there are some similarities with startups where we start with some hypotheses and some say ideas on the markets and then depending on how or the evolution of the products which is at the end what dao is is building this may lead to a pivot or maybe to an evolution or maybe to just an expansion in that i think it's normal from what we saw in traditional startups and dao's are like startups except that they are broader and more open and more decentralized yeah with the spectrum that i was mentioning in the beginning one thing that i've noticed though in i don't know maybe it's just because of resources available a lot of dials exist on discord and twitter and very centralized platforms and quite frankly discord doesn't really care for dallas so why do you think dallas used those platforms specifically like because you could spin up a discord server in a few minutes right um i think like there is there is some effort from discord or some popular platform where they um want to have like joint ownership as the admin of the of of the of the channel but i don't recall who was building that but but again this comes back to the dow tooling which is in very early stages like people are actually trying to do this for example i know few teams who are building this front end which uses telegram in the back end right so they are giving you a front-end interface where let's say you can actually do some things using or some signatures where you you know with your with your addresses and then like you know something which is in their custody but that requires the signature from this this thing also then can do some activity on telegram so this is one layer one kind of solution that i'm seeing which which are using these existing social platforms to build the dow two links like for marketing of dows i also you know uh you know met a team which is trying to let's say use instagram and facebook and all that underlying so you see the dao interface but underlying it is using apis of instagram and you know like other social social websites so that's one thing but the second thing is that there is native dow tooling also you know there are a lot of teams who are trying to build it like you know people trying to build a decent lives if if not a decentralized discord but at least a discord where you can create a channel which can be owned and governed by the dao you know multi-sig or smart contracts and things like that so i think we are early in that in that journey but all this tooling is being developed discord you can also have this connection between a wallet where you identify yourself it's using using web 2.0 technologies but still it creates a bridge between the decentralized world and discord so i think maybe a future we'll see decentralized discord or maybe discord will decentralize itself given that i think the biggest communities in discord are after maybe gaming is a crypto so maybe this is an incentive for discord to at least create a variation that is sufficiently decentralized for thousands yeah and some early tooling like i would i would recommend a lot of people like you know who have not experienced maybe look at collab land which is like you know token gated community dao house and things like that who are building these two links uh for dows to you know you mentioned earlier about um startups so moving forward do you see dows as less of a social thing like they are on on discord for example and more like or traditional startup words more like this is the because they're not supposed to be right they're supposed to be it's not supposed to be a tower supposed to be a net like instead of going up and down it spreads out right so do you think you see that happening more how do you see this developing i mean i'm not sure whether taos are not supposed to be startups uh ideally tao should be able to be a startup if they want to be like of course if the community wants it's just that those design patterns or those behavioral patterns or those governance patterns have not evolved for example like one of the biggest criticism of dao is that it's very hard for uh you know it's it's very hard to do fast decision making right and uh you know people are countering that with let's say making delegated delegated committees where let's say you are creating a dow which which invests in protocols right or other projects so you can create a sub committee or an investment sub within your larger dow which where where the community chooses uh gps for that and then based on their performance community can you know promote them or fire them right these kind of design design patterns should emerge where the delegates then can take a very fast making uh you know in that sense similarly as a startup one other big problem i see which is which i feel is is very big problem is that startups at times have to be competitive uh in nature right like so you know you can't discuss your future ideas if you being a startup on a public discord where let's say the people from your comp you know other competitive company can also be there right so how can these um you know how can these ideas which a startup might want to run uh can be discussed in a private way while still the community can contribute or community can participate in that those are some of the challenges which i see but i actually definitely see that startup should be uh i mean dows should be startups otherwise this will not go like that non-profit thing and this casual stuff then daos will not be able to realize the full potential we want the whole world the enterprises to come to dave yeah i think it's not definitely not mutually exclusive and when you're building an early stage startup um it's hard to have a large team in anyways i mean it's always more efficient to have a small and concise team and dogs i don't see the exception here and that's something we can see even in an anonymous dolls like olympus pro where they have a core team that is contributing and the team is like the dow sorry the crowd that's participating on the dao you can map it to when i create a startup when i create a product i still have a community see neither communities you need early adopters so i can see those audio adapters as these guys who are part of the dao but the difference here is that these guys have an influence have a voice and they can also challenge or make the core team have some kind of accountability for for these guys where that's something we're not seeing in in startups but i think we need that in startup so when you create the early stage product we love to have a community of early adopters that are super passionate and now we're giving these guys an incentive and a part of this community so it's like we're building a public company but this is a startup and it's all happening on a blockchain that is completely transparent so i think yeah that's an upgrade in startups that we're seeing right now there is no playbook or something we should just follow as we may have in startups like lean startup methods and so on but i think we can have something meets in the middle and use that as a leverage in order to grow the product and make it i would say more successful because we're getting a second eye we're getting a native community that have a share on the protocol yeah and i also want to add that you know we also should not look at that look at it as a zero to one thing so for example you don't you might not need a dow on day zero like for example let's take example of paraswap right like money has been you know working for years now right and then only only let's say one one and a half years back they launched and now you know like they have the big community they are now slowly you know dowing their their their startup right so that that could also be one journey you start as a startup free startup and then eventually convert into a dao and uh and and you know one other thing i wanted to say that uh yeah so one one other way could be progressive decentralization of a dow right you don't need probably 50 000 members in your in your discord on day zero you could start with 20 people 30 people contributing to something and we already have examples all the d5 protocols many of the nft protocols are already startups which are which started as a startup by few individuals then became taos and now being run by daos for example d5 protocols the dao communities today vote and force the force the founding team that they should deploy this protocol uh you know on other chains also which let's say if the founders don't want to do but the community can pressure them or put the decisions on them that no they should deploy it on the chain so that's like now running a startup itself so it's already happening in a way i feel so let me get your opinion on dows as llc's because that's becoming a thing too for example in wyoming you can incorporate a doubt so it's the internet the internet is not bound by boundaries and borders so do you see that as something that's viable long-term mean for example i started dow i incorporated in in wyoming someone in singapore can still access what i'm doing so what do you think that actually has any bearing on it but i think it's a case-by-case scenario where sometimes to create a breach to the real world unfortunately there is no way to do it right now maybe this would be normal i don't know five ten years from now but suppose you want to sign a contract like legal binding contracts unfortunately that needs a legal legal entity or anything that requires a legal binding contractual relationship needs this legal entity a good example also is maker dao where it is a dao but they have in multiple jurisdiction multiple i would say sub sub subsidies uh they are handling things like salaries how do we pay salaries in fiats how do we make bank transfers how do we contribute to some conferences that are not really native a blockchain native they need they need to be paid in fiat anything that requires a bridge to the real world needs some kind of legal entity and that's a great thing that states like wyoming created this possibility it used to be just foundations and now we can have like a physical representation of the dow so i think i don't think it has to be by default there should be a very specific need to creating this down like paying for for for paying in fiats yeah yeah um i think like you know again uh these these locs and you know llp structures and all that in the real world are important uh because it's not going to be a zero to one journey that you know we suddenly move from this you know current kind of world to dows on one day so it you will need these intermediate stages where you need these things but the way this this whole space has exploded in the last i think one one and a half two years i think it's it it's not crazy to think that some of these you know company registration departments will come up and say that okay we are going to allow the registration of a company or incubation or incorporation of a company on blockchain let's say on ethereum one thing i feel that you know that's lacking there is is only the decentralized identity and uh i think that zero knowledge technology has a lot of promise over there like we are also for example at i mean it's still it's going to come out soon but uh trying to work on uh something related to identities where you can have this identity related data like for example company also has a lot of identity related things like where is the address and all that and you might not want to put it on on a public blockchain right so but you still might want to prove that okay this company is registered in u.s right so using decentralized identity you could actually or as a founder you don't want to put your information on blockchain but you should be able to prove that i own this entity and i am a legal resident citizen of u.s i think zero knowledge technology has a lot of promise over there where somebody can issue this entity or incorporate this entity uh you know some state department somewhere in the world and start that process where you know this incorporate com company is established in on on chain it has this this this percent for these these addresses and then the company has some you know identity information including the ubos of the company as well as the company details and then with zero knowledge technology you can prove it to external parties wherever you are interacting with them sign documents and things like that but again it will not be a zero to one journey it will be a it will have a lot of you know branches in between uh you know in the in the in the transitory stage so we're wrapping up so my last question has to do with the privacy and anonymous nature of not only daos but crypto in general so if you're going to be an llc in your opinions should the leadership of the dow be docs should people know who they are what do you think i think part of the answer was what sandy was saying about zero knowledge proofs where you can keep a privacy for i mean the the the like the the the real world but still i mean in a legal point of view that's not possible unfortunately um so i think there is a middle ground here where you can still rever reveal your real identity uh but in in a very small context and that identity will stay private because it's revealed only within that context and not necessarily to the republic many people will just want to keep their privacy for personal reasons that can be anything but it doesn't stop them to identify themselves to a legal entity while still keeping a a certain level of privacy using potentially zero knowledge proofs like cynthia passania and you know about this doxing thing like not only the founders even the community members for example you know there's a lot of civil uh you know non-resistance on in in this house right you know may you might think there are 10 large token holders but that might be one single guy with 10 different addresses right so um again like you know with that identity thing i think somebody needs to solve that civil scenario for the community also but on the founders side like i think the the fun part of dao's is that they are like extremely flexible like so if it should be on the community where community says that okay we want our founders to be dogs or or you know it can say it can be okay with founders being on right and i feel that you know the way or the the future we are moving towards you know there will be a fairly high amount of you know market share or a number of people who would want to be an on but you know with blockchains these addresses of yours become your identity they show your track record and they are much bigger track record than your you know the resume is we all know everybody fakes things on resume right so this can be much better tangible record of of what you have done in life and then based on that you might be trusted also so i feel that anonymous existence of founders or community members and all that you know there will be a large segment of the society we will use that uh but if somehow we are able to solve this civil scenarios civil attack scenarios i think that's the that's the perfect match and yeah zero knowledge technology can do that i feel all right well thank you gentlemen for joining me today i really appreciate it thank you audience and uh i hope you guys enjoy the rest of each denver take care everybody