How To: Trusted 3rd Party

el Prof
October 26, 2021

We’ve talked in some length before about DAOs — decentralized autonomous organizations, or the 2020s answer to hippie communes. To be fair, there’s no cult leader at the center now, but, like in any social setting, centralized or not, power still orbits an inner circle.

DAOs serve a myriad of supposed purposes, from inciting cultural revolutions to buying Wu-Tang albums, so mileage (and success) varies. Even though the current application is predominantly Discord channels designed to show off AI-generated status symbols, this headless approach to organizational management does excite me. The labor market, believe it or not, could use a shake up.

The beauty of DAOs lies in the volunteerism of their contributors — in spite of the ‘roadmaps’ associated with most, which detail structured rewards doled out to members for helping to see the vision through, DAOs appeal primarily to the intrinsically motivated. In other words, most involved see this as mission work, even if said mission is deciding what doge meme to spend your next million on. 

But to assume that DAOs are the final Pokemon evolution of organizational structure is to ignore Chaos Theory, the 2nd Law of Thermodynamics, and the rest of reality. (So, old hat for most crypto degens.) Organization often leads to unbalanced power, sure, but people left to their own devices don’t fare much better, especially when the alternative is pure chaos. 

There is an argument to be made for how the best organizations of the future will be DAOs, but to think that traditional organizational structures are incompatible with the decentralized Internet of the blockchain and Web 3.0 is naive. Centralization is a component of trust building, which there will always be a need for, even in decentralization. Yes, the latter allows for data mobility and technological freedom, but that choice will be exercised mainly by those with access to it (Internet natives, entitled little bitches) and not those who need it (political dissidents, average people). For most of the citizenry, a trusted third party will need to exist to facilitate wallet management — a requirement for the widespread adoption DAOs love to trumpet.

I ask can there be a DAO of DAOs? One that’s purpose is simply to enable other DAOs to provide identity verification services to individuals onboarding into the metaverse. In a Proof-of-Stake world, like the one we are heading towards, rewards those with more to have a bigger say in governance. Something I’d argue is hardly innovative over our status quo hell in the United States.

A better alternative would actually be ‘Proof of Identity’, something that the cryptofascists are pushing with projects like ‘Worldcoin’, but without the central party at the helm. Again I ask, can we create the DAO of DAO’s?

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