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Journey Into The Metaverse: The DAOwnload

TYLER BANYAY

10 FEBRUARY 2022

Between our exploration of the beginnings of the metaverse and the most recent Twitter discourse around Bored Ape and NFTs, we’re continuing to surf the Web3 wave and its possibilities for the future. Most recently, we’ve had our eyes on Distributed Autonomous Organization, better known as DAOs. 

 

Put simply, DAOs are self-contained cultural economies. Rather than having a centralized authority, they are community-led, with individuals collectively organizing and distributing capital towards a democratized goal. In essence, each DAO is an island with communally-agreed terms that dictate how the collective will reach its goal. An infamous recent example is the Constitution DAO, who raised $47 million USD to purchase an original copy of the US constitution; although it fell short (unlike Nick Cage), they got pretty close. 

 

At its roots, DAOs are an extension of blockchain tech: they both seek to reach transparency, whether that’s in monetary exchanges or in online cooperation. 

As the metaverse unfolds, communities are finding even more power in gathering in online spaces. Online communities already have a hand in shaping the culture; with DAOs, these communities may take on a larger role in the zeitgeist. With new capabilities and additional resources, they can fuse technology and socio-psychology to build autonomy and expand collective agency.

Because DAOs are essentially blockchain-enabled computer programs, online communities can use them to enforce agreements in a more democratic, decentralized way — made possible through smart contracts. Once a core group of members encode the smart contract, DAOs raise funding by issuing crypto-tokens based on participation, contribution, and investment. Holding tokens means you can submit proposals, vote, and ultimately share rewards as a member of an online economy. This fundamental technology at the core of DAOs moves around the blocks within bureaucracies: DAOs eliminate the need for bigger institutions in favor of more democratized, self-contained organizations. 

 

Decentralized & self-governing: power to the people. 

Plenty of organizations have already begun learning how to elevate community participation using DAOs, such as Friends With Benefits. FWB, a cultural DAO, brings together “Web3 artists, operators, and thinkers by shared values and shared incentives.” Unlike in the traditional art board where bureaucracy might stall resources and plans in motion, FWB harmonizes editorial content, artist grants, NFT ephemera, and IRL galleries into one collectively-led system. They also recently hit the art circuit by organizing a spectacular Art Basel party. Attendees saw performances by Azealia Banks, Erykah Badu, and were treated to an exclusive NFT drop, capitalizing on the art world’s curiosity for crypto x culture. The physical nature of the pop-up party is only a microcosm within FWB’s ever-expanding universe. In a sense, it’s a model of community wherein the creative directors are truly pioneering the evolution of digital <> physical experiences.

Meanwhile, other DAOs are trying to solve everyday problems. DinnerDAO, a social DAO that’s assembled in cities like New York & Portland, is tackling how to split a bill at the end of a dinner. DinnerDAO’s prospective members purchase an NFT that grants them membership to a token-gated community, who then vote on the experience. Funds are then pooled into a treasury which ultimately pays the person who paid for dinner. Though the process seems convoluted, DAOs like this one help to eliminate the need for a middle man. 

Historically, technological innovation can be clunky as it works itself out. Projects like DinnerDAO allow us to enjoy ourselves while actualizing  the value DAOs have to offer. 

There is still much to learn about DAO’s limitations and misgivings. Take Spice DAO’s recent mishap for example. In their quest to obtain Alejandro Jodorowsky’s famous rendition of Dune, Spice DAO failed to do their own research, rather than paying for the IP, which would have allowed them to make films & animated series, they instead paid for an object, spending $3M for the book that was already freely available. Though DAOs offer sensational new benefits, we heed caution as we grasp the scope and potential for this new technology. 

We believe that DAOs have the potential to supercharge brands by collapsing the roles of consumer & creator. As brands seek to participate in emerging online spaces, DAOs’ technology offers safe and user-generated content to empower their brand communities to co-create, rather than just react. DAOs bridge the gap between URL and IRL experiences where socialization becomes more informed by digitalization, DAOs like FWB and DinnerDAO highlight the demand to explore DAO-driven experiences like community dinners and gala events. With the right leverage, these types of experiences can heighten a consumer’s bond to a brand. If you’re interested in learning with us as we explore how to empower brand communities, drop us a line. 

Best,

Tyler Banyay, Guest Contributor