Why DAOs Matter - Shannon Wells

just while we get set up i'm really curious um who's in the audience and how many like knowledge check on dow's here how many people are brand would say you're brand new to dao's whoa okay how many of you are part of more than five dows okay so probably somewhere in the middle um awesome also i just sprinted here from my hotel because my uber canceled on me so if i look like i'm panting it's because i am panting that's it so awesome hey okay we're good this is a slow starting talk excited to be here thanks so much cool thanks so much uh hey i'm shannon here to talk about why doubts matter it seems i'm sure a lot of people in the audience probably have your own thoughts on why doubts matter i'm going to share a little bit about the particular lens i bring on to think about dows and would love to make this interactive if folks want to throw out questions in the middle of me speaking please go ahead i'll try and keep the talk short so that we can open it up to q a um so why why do doubts matter there's some a lot of subtext that could be put here i'm going to try and really briefly go through thousand in their core essence what i think underlies why so many people are interested in dowse at this particular moment and i think it's around decentralization as a core value culturally and end with some challenges for future dow design so first of all who am i um i entered crypto in 2011 when i was working in canada's finance department in the financial sector policy branch where we thought bitcoin was a financial crime and i was helping to regulate it with regulate it with canada's central bank so i'm a recovering bureaucrat i spent five years in the central agencies of canada's federal government i was in the privy council office where i advised the prime minister on intergovernmental relations came into government after being a political scientist looking at federalism so i think a lot about yeah decentralized governance structures i went on to work at the world economic forum for three years which again some of you are probably familiar with as a very centralized approach to try to make the world a better place um i spent a bunch of time in impact investing as well i was canada's representative at the global steering group for impact investing in 2018 to 2019 and really dove headfirst full-time into this space in 2019 started doing hackathons with eath global mainly to try and find my niche as someone who's not a developer but cares deeply about governance yeah where could i fit ended up meeting an amazing solidity developer over a year ago and we designed a layer two dow protocol together called devolution which won the scaling ethereum hackathon last year and the whole idea is creating an extensible modular composable dow framework that gives communities the flexibility they need to design their own governance structures um in september i left the founder journey and got poached by live pier which is building the world's open video infrastructure and i was hired as head of community governance there but we've been growing insanely rapidly since september and i now do anything that's not technical um i just this morning gave myself a new title called chief chief decentralized growth officer we're trying to help us spend 40 million dollars in venture capital in a way that helps our communities grow with us i'm also from a very small and special part of the world called newfoundland which is a big reason why i care about um creating a networked world of inherently distinct creative unique places people and it's why i'm interested in being here and talking about this so what is a dao you guys have probably seen this slide before i think it's probably koopa trouba's greatest contribution to this space is actually listing everyone who claims to be a dao you can see that there are so many different ways to slice and dice what a dow is we have um dao operating systems which i would probably put devolution where you actually like creating the dow technology and the software that communities use to run dows protocol dows like d5 projects would be traditional um protocol dow projects i would put live peer as a protocol dow as well investment dows like metacartel the lao you know these are investment club syndicate dow does a really good job of helping groups of less than 100 investors spin up and collectively make decisions over assets like nfts social dials like friends with benefits seed club which are really creating social tokens and membership based styles so there's a lot and there's probably more um that's not on this slide but you get the the sense for i mean i think the three basic categories people tend to agree on are protocol dows investment dows and social or creator dows um this is a an interesting piece that forbes published just a couple weeks ago um just highlighting i think the the moment that dows are having uh as you know really mainstreaming their legitimacy that um this i don't know if you can tell this photo is actually a picture of uh tribute lab ceo aaron wright and the ceo priyanka desai um who are the founders of the lao and have done just a huge amount of work to advance the dao space and um they're standing in front of a popular nft mirror mural sorry that their dao uh their doubt purchased um and flamingo dao turned uh essentially 10 million dollar investment into what's now a one billion dollar nft collection so it's an example of an investment dow so in essence i mean you could we could spend the whole day trying to debate what a doubt is but i think for me fundamentally and the definition that i want to stick with is dowser fundamentally using blockchain technology to design and govern collective decision making over shared assets on the internet and i feel like this definition just really puts smart contracts at the core of dows and makes clear that what we're talking about are groups who are actually using smart smart contract architecture to decide who gets to vote on what and most importantly how those decisions of the community get executed and sometimes people think oh go ahead maybe i'm misunderstanding your definition but by your definition maker tao is not a doubt well maker doubt governs their protocol though right yeah so that's a really interesting question so the question is what's an asset that's i think the really interesting point um yeah so do i think uh you can be a dow without a treasury absolutely you can totally spin up uh like basic dao smart contract architecture that doesn't have a treasury module attached to it you just set up a like voting like you you can just set up a data you can call it out you can create a voting logic um an execution logically on that so yeah i think again because i want to i want to stand by the smart contract connection definition you do need some kind of token to be able to you need some kind of smart contract framework to do the actual voting logic in execution whether that's a multi-sig or a governance token yeah good question we can definitely get into that more um yeah i think some of the other like misconceptions around daos are like they're radically democratic and that everyone has to vote on absolutely every decision and if it's not if everyone's not voting on everything it's not a dow i think that's actually false and there is a lot of different ways and amazing projects that are working on creating sub-dials and nested dow structures where you start to identify um what are domains of expertise or functional areas or just you know types of decisions or like domains of knowledge that not everyone has to be involved in making decisions making decisions on um so that i think that's another important point did anyone else want to debate make a point ask a question around defining doubts because i'm just going to stick with this definition after this cool um so i think you know asking why dows matter for me i i think it's really about why decentralization matters um and my kind of thesis right now is that the growing interest in dows is really about the perceived value of decentralization that underpins blockchain technology so blockchain has gotten us to this point where more people appreciate decentralization as a way of organizing um and doing and building things and being so d5 was arguably the first valuable application of the underlying blockchain technology layer but you know one of the most important trends in the blockchain space over the last year has been this transition from focusing on decentralized finance and d5 to also thinking about decentralized governance and that's really what what doubts are so why are so many more people gravitating towards decentralization is something that they want to be a part of culturally socially technologically um and i really think it's that we've we've reached a point where centralization and uniformity have just created a bit of a toxic plague in um our global culture really that is it's creating a plague of sameness that i believe is killing human joy and creativity um and i know the people in this space are actively working um to move us in a direction away from that but i think that it's the frustration with this feeling of um yeah just sameness um making it harder to feel like you're different and to see what's different is what's driving a lot of momentum um here and i think that that plague of sameness um and that kind of top-down way of looking at how to make the world a better place has actually limited our creativity and our ability to solve public problems at a global scale um the un s the u.n sustainable development goals are probably the closest global consensus we have right now on what's wrong with the planet um and the the financing gap like the estimation of the the funds that are needed to deliver on all 25 of those development goals it just keeps getting bigger like when i started in this space for five years ago the gap was like two trillion dollars and now it's with the pandemic 100 trillion dollars so we have to ask ourselves like how is it possible that we know that much money exists or like that amount of capital or resources exist to be able to solve these problems but they're not getting solved so um again i think that the potential for dows as a tool to help us coordinate at scale is why people are also entering into this space so another way to think about this is peak centralization i thought i made up that term last night but it turns out blodgies used it a lot um um and i what i've just described is really i think awakening a collective kind of unconsciousness and we're all just feeling that kind of malaise and i think that the way we're seeing people activate around decentralization and dows within the blockchain space is really around three different axes and that's technologically people are waking up to how centralized things are you know the fact that blockchain was created and we've all been building in this space for a while shows that we're actively working to decentralize a centralized you know technology industry economically i think people are frustrated that we've used gdp as a blanket metric for how we're all doing in the world that gdp you know as the total monetary value of all goods and services produced by country um is the ultimate measure of prosperity but of course gdp you know misses a lot it doesn't count um people's health or clean environment and it doesn't pay attention to our quality of life and you know on the on the centralization around the economic access of course you have um you know centralization of wealth and that comes from the ownership of capital and people not owning what they're putting their work towards and i think again that's another reason why people are really interested in the dow space at this moment and socially um i think this one's really interesting so because we have this centralized monopolistic web 2 technology industry that because of its business model forces creators to build the largest possible audience so advertisers can get the largest number of eyeballs on content has forced people to um build really shallow audiences and be part of really shallow audiences and there's a huge epidemic of loneliness that the pandemic has only exacerbated i mean the numbers have just been getting worse about like the extreme loneliness people are feeling so again i think that the promise of daoz and why more people are interested is because it creates a more promising way for us to engage meaningfully with one another and to find community and feel sense of belonging so i want to like just spend a bit of time going to a few examples of how dows are being activated and how decentralization is kind of materializing right now around those three axes um so the first is around decentralized tech and web3 infrastructure and why does decentralized web3 technology matter i've kind of alluded to this already but in web 2 developers and creators are forced to rely on a few centralized services and platforms and to cover the high cost of operating internet infrastructure and i think that's the core point right it's like it's expensive and complicated to do things like video transcoding which live here is decentralizing um and so to cover those cost platforms like youtube rely on those advertising business models that you know capture users personal data and force creators to develop those mass audiences and youtube has a 50 take rate on every dollar generated by a creator on its platform um and youtube had to sell to google because it couldn't cover its infrastructure costs um i don't know if youtube's actually still losing money i think twitch is still losing money because again they can't cover their infrastructure costs so if this is why we're building web3 at like an infrastructure level um is to be able to solve this problem and i will chill with the show live here just for a second so life here is a proof of stake protocol built on ethereum that provides decentralized transcoding so transcoding is what optimizes video for every device and it represents about 80 percent of the internet's bandwidth today and with a global decentralized network of node operators live video services are actually about 10 times cheaper than centralized industry servers so we really want to be part of a new um renaissance of like applications on the internet that can use you know web3 infrastructure and to create more decentralized applications and there are other amazing infrastructure projects that are trying to like lower the cost the graph are we akash there are a bunch of others who are here this week or maybe somewhere in the audience um so decentralized value and the creator economy so dowse and decentralization here like really create the potential for more diverse and sustainable communities around new and unique sources of creativity and the value creation of that create and the value evaluation of that creativity in new ways through tokenization so oh two minutes oh okay okay creator economy we can talk about that so basically um yeah you can unlock new forms of value i'm happy to chat more about that the dow structure provides like a really natural home for that through which you can rent your talent in time and leverage it to facilitate fractional ownership um in a community or system that is fundamentally governed by that community so the um decentralized society angle the age of community i think that's another really big reason why people are showing up in this space um this is a really hard slide to see but this is a you probably all know this maslow's theory of human motivation and maslow's hierarchy of needs and the premise of which the greatest need is self-actualization this slide was actually created by a university of alberta professor kathy blackstock in 2014 that shows the differences between maslow's western philosophy of hierarchy of needs and first nations perspectives on the hierarchy of needs and maslow actually did a lot of his research with indigenous communities to come up with his hierarchy of needs he just forgot that after self-actualization you actually need community actualization and that part of our sense of belonging and identity comes from being in a community and being with people who see the value that we bring to a project and acknowledge what we can create and what we can contribute and i there's a lot of really amazing work around regenerative regenerative communities in the space right now and again i think this speaks to why more people who aren't devs are coming into this space is because we want to feel that sense of belonging and we want to be seen by a community um what problems do you does uh what problems need to be solved to help downs reach their full potential i don't have a ton of time to go through all of this i'll just quickly run through it but they all relate to um actually governance token standards so if i go back to my initial definition on what a dow is and that it's fundamentally using blockchain technology we really need to think about and evolve the technological underpinnings and software um that make up how governance happens on the blockchain so we there's still a problem right now where a lot of deep legacy dow it's funny to have legacy downs now but d5 projects who are still using liquid token governance um to do um their voting and um what we really need to be moving towards is kind of mixed token standards where you actually can't sell or transfer your vote you have to make governance more tied to non-transferable identity and social and non-financial contributions to community um i ran out of time but the rest of the stuff that i talk about here is actually if you go to devolution dao on twitter um that's the project i've been involved in you can see our demo there's more information on the challenges at an architectural level for dows but that's my pitch on why does matter thank you