The last few weeks have seen some major failures in the area of DAO and distributed governance. They’ve also marked a revival of energy for DAO technology, with new initiatives that seem to pick up where the failures left a gap.

Rising from the ashes…

As presented in my DAO Case Study Research last July and October, most of the DAO experiments were unsuccessful, so this list includes just 3 very recent failures.

  • Genesis DAO members take on continuing the experiment
  • Nectar DAO launch
  • dGov Council members revitalizing the organization

2020 starts with disappointments

Genesis DAO: vision mismatch

The collapse of the Genesis DAO has been a long time coming, and in fact, it can hardly be called a failure. DAOstack created the Genesis DAO on its Alchemy platform as a sandbox and experiment in DAO functionality. The Genesis community was hugely active and drew a highly-skilled and well-versed group of participants from around the globe. As a result of the Genesis project, more than twenty new DAOs were launched on the Alchemy platform. Hundreds of people tried out the technology in numerous “dHacks” and a couple of dozen “DAOfest” events took place worldwide. A large knowledge base was created at www.daolandscape.today through the efforts of Genesis DAO and dGov participants.

Festivus for the rest of us

The DAOfest explosion is one of the great successes and great failures of the Genesis Alpha, and it resonates with some of the previous criticism of DAO funding distribution in DASH. Basically, the problem is that people love events and meetups, and they love getting paid to put on events in their local communities. They love it so much that a tremendous amount of money ends up going towards events that don’t have tangible outcomes, and even if they do, there is generally nobody accountable for maintaining the community of event organizers.

Lack of functionality

The major failure of DAOs today is lack of functionality. DAO technology on Ethereum today allows a sophisticated multi-sig scheme (voting of a majority for release of funds) and/or automatic implementation of on-chain code upgrades (voting rather than forking code). These are both great functionalities, but they lack creation of social fabric or even a shared mission for the DAO. This shortcoming was pointed out both in the DigixDAO post and in the document posted by the outgoing Genesis DAO community managers.

Triumph and revival!

Despite these disappointments, the community is showing resilience, and the initial failures have given birth to new and more appropriate uses of DAO technology. NectarDAO is leveraging what the technology does best: distribution of funds. NectarDAO is fulfilling on its promise to let the community manage their own funds using DAOstack.

Community resilience: Genesis DAO and dGov

Attending this year’s dGov Council was a disappointment for me. Last year, the Council was sold out at 60 participants, and this year we barely scraped 30. Given how amazing last year’s council meeting was, it was a major failure. The dGov Council meetings go deeper than any other medium in the industry, and it’s a shame more people did not attend.

Nectar DAO: Large-scale DAO on DAOstack

As mentioned above, the NectarDAO has launched on DAOstack at the start of 2020. NectarDAO has more active members and a larger budget than any previous DAO on DAOstack. The DAP members have proven their excitement and involvement in DAO participation. Over the last year, the NectarDAO participants have successfully used the Kleros technology to choose the tokens to list on the Diversifi exchange, and now they will be using DAOstack to decide what to do with their budget.

Hypha: The first DAO outside of Ethereum

The Joinseeds and Telos communities are developing the HyphaDAO, which is the first generalized DAO technology to be developed outside of Ethereum (to my knowledge, correct me if I’m wrong).

Conclusions

While we’ve seen some major setbacks in DAOtech during 2019 and the start of 2020, the community remains vibrant. Rather than being discouraged, the failures seemed to fuel renewed commitments and wider participation. It seems that some of the people who were satisfied to watch and wait have felt called to participate actively, and that several of the new DAO structures are better designed for collaboration than the prior generation of technologies.

Founder, IwriteICOwhitepapers.com and DAOLeadership.com. Author: "So you've got a DAO: Leadership for the 21st century"

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store