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What makes a DAO actually decentralised: Swarthyhatter.

Part of a working session on building the We Them Media DAO, and the clearest explanation on the channel of what the word is supposed to mean. The worked example is a logo competition: an open call, then the six favourites each go up as a proposal people vote on with their tokens.

Why that is better than picking one: “the process of doing this is what builds your community,” because “participating in the decision makes them actually a member of the community. That’s what brings them back.”

Then the part with teeth. Most projects, he says, “parade around the fact that they’re in a DAO, they ask people to send them logos, and then this little body of people just pick what they like. And then they put that out there and they represent that as decentralized community governance. It’s totally” not. What it actually is: “centralized intermediaries making choices without any enforceability from the broader participants.” Do it the other way and “you can credibly call yourself a decentralized community. Maybe not autonomous, but definitely credibly decentralized.” And the difference between the two words is enforceability: “what makes you autonomous is whenever every part of your organization is enforceable. It doesn’t rely on you or informal agreements, but there’s mechanisms to enforce it.”

The last minute is about who gets to decide. The people who staked in, did the work or contributed the intellectual property hold the authority; the users and the wider public get to “weigh into the process. Not authoritatively, but nonetheless.” He calls that governance signal rather than consensus, and says it is how you defuse “the founder community tug of war that people are always trying to play.” Language is unfiltered. The transcript below is from the original audio.

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Transcript

Transcribed with Whisper from the original audio, so nothing is masked. Names corrected. Published in full, as spoken, so it can be read, searched and quoted. Search every transcript →

0:02You have a logo submitting competition. Everybody in the whole world submits logos to you guys. Ungated process. You now pick your favorite six, and each one of them goes up as a proposal. Hey, we want to approve this one, and this one, and this one, respectively, right? And you get six content posts that represent, hey, is the logo going to be this, this, this or this? And then people swap their token into the side, right? Okay, that’s probably a simpler way that adds less friction into what you’re already trying to do somewhere else. But the process of doing this is what builds your community, right?

0:42Like more so than them coming and giving you the logo and then seeing it become the choice, participating in the decision makes them actually a member of the community. That’s what brings them back and gets them to own their own vertical.

1:03And this is a significant, if you start with this, you’re a significant leaps ahead when people say, I don’t like decentralized communities. You can start to scoff at them and tell them they don’t know what they’re talking about, right? Because this type of decision making, typically people just parade around the fact that they’re in a DAO, they ask people to send them logos, and then this little body of people just pick what they like. And then they put that out there and they represent that as decentralized community governance. It’s totally fucking not. It’s centralized intermediaries making choices without any enforceability from the broader participants, right? So the moment you start making choices this way, or even a little bit more formalized and on-chain, you can credibly call yourself a decentralized community. Maybe not autonomous, but definitely credibly decentralized. And what makes you autonomous is whenever every part of your organization is enforceable.

1:59It doesn’t rely on you or informal agreements, but there’s mechanisms to enforce it. I would say like down here, once you have your decision, like we need to work on enforceability down there. Like how do we make those things actually manifest? But that’s why when we talk about Bitcoin, we say we’re providing governance signal and not like consensus. Consensus, because it’s still up to the DAO up here with the voting assets to approve the final content, right? So consensus remains with the top level organization, but you give the ability for your community to provide strong governance signal.

2:41And that starts to address like the founder community tug of war that people are always trying to play, right? The founder community is the top level authoritative body. This is people who have staked into the DAO with equity, who have done work, who contributed intellectual property, or who have staked in with investment, right? So those are the only people whose decision-making you really are trying to value. That’s what this top-level body is. But then when it comes to the people who are affected by your product, the users, the consumers, or people just in general, if you’re trying to do a public good, this is where they get

3:20to weigh into the process. Not authoritatively, but nonetheless. It at least gives you a place to start from if you’re a member, if you’re a regular community member, and you’re going to say, why didn’t my logo get picked? It met the criteria, it got the highest market cap, why didn’t it get chosen?

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