The Dao of DAOs - Not Boring by Packy McCormick

Supporters believe DAOs have the potential to reshape the way we work, make group decisions, allocate resources, distribute wealth, and solve some of the world’s biggest problems. DAOs are why Ethereum was created in the first place.

SushiSwap is similar to Uniswap in almost every way except one: on SushiSwap, the 0.30% fee is split, such that “0.25% go directly to the active liquidity providers, while the remaining 0.05% get converted back to SUSHI (obviously through SushiSwap) and distributed to the SUSHI token holders.” The introduction of the SUSHI token, and allocation of ... See more

One of the beautiful things about decentralized protocols is that their code, smart contracts, and transaction histories are out in the open for anyone to see, audit, and even copy. That openness acts as a check and balance; it incentivizes good behavior and protocol optimization, because if enough people disagree with the way the team behind a pro... See more

Just because something touches crypto doesn’t mean it’s decentralized, and just because something is decentralized doesn’t mean it’s a DAO.

Coinbase lets people buy and sell cryptocurrencies, but in every other way, it’s like a centralized exchange on which you’d trade equities, bonds, currencies, or commodities.

Many crypto startups raise traditional venture capital to fund product/market fit discovery, often under a Simple Agreement for Future Tokens (SAFT), a structure developed by Protocol Labs and Cooley that’s similar to Y Combinator’s SAFE, except that it converts into tokens instead of equity should the company issue tokens in the future.

More simply, DAOs are a new way to finance projects, govern communities, and share value. Instead of a top-down hierarchical structure, they use Web3 technology and rapidly evolving governance and incentive systems to distribute decision-making authority and financial rewards. Typically, they do that by issuing tokens based on participation, contri... See more

Unlike Stripe and Twilio, though, which don’t hand equity out to their developer communities, at this point, crypto companies can and should start thinking about how to use fees and tokens to incentivize ongoing contribution to supercharge community involvement and loyalty.

The example brings up an important point: crypto companies don’t have to, and generally shouldn’t, be a DAO from day one. They can evolve. Unlike The DAO, which launched from day one as a DAO, both Uniswap and SushiSwap are going through what Variant Fund’s Jesse Walden coined “Progressive Decentralization.”