Thread by @ianjohnlee

1/ 100% agree that DAOs in of themselves & decentralized governance are not “the thing”.

But the structural unfair advantages that “DAO tech” offers (especially when paired with DeFi) and the applications they can enable will be revolutionary, very, very soon.

Let me explain 👇

https://twitter.com/lanrayige/status/1379909011517140993

2/ Bitcoin, blockchains, crypto, DeFi & NFTs were all at one point misunderstood. Many of them are now well understood, but it’s important to remember they were once viewed very skeptically.

People now get DeFi. NFTs are getting there.

DAOs are still further behind IMO.

Why?

3/ Let’s take NFTs. They started over 3 years ago in 2017 with @CryptoKitties.

There was a boom, there was a bust, then we didn’t hear about them for years until recently. What changed?

DeFi.

DeFi infrastructure enabled things with NFTs that weren’t possible before.

4/ When you now look at NFTs and how they’re being created, accessed, and used, it’s very different than 2017.

NFTs with embedded DeFi primitives like auction markets @ourZORA. Superfluid exchange of NFTs with social & governance tokens. NFTs as collateral in lending protocols.

5/ DeFi infrastructure has evolved and expanded the way we think about NFTs and their role in the world.

NFTs are also not just digital collectibles. NFTs are internet media assets owned by internet users—that prove we showed up, love something, belong, or identify. That’s big.

6/ When we see NFTs this way, their potential applications are massive.

- social media
- entertainment
- creator economies
- gaming
- e-commerce
- and so much more to come

How will this happen? We need to think about the unique *properties* NFTs bring to the world.

7/ Here are some of NFTs’ unique properties—especially when combined with DeFi:

- Permissionless
- Composable
- Provable ownership
- Scarce ownership
- User/community owned
- Embedded provenance
- Price discovery and liquidity
- Global transfer on the internet
- and more

8/ Physical collectibles don’t easily have these properties—but more importantly, none of these properties are true about today’s internet media (music, writing, video, games, images).

NFTs will be transformative to the internet, and everything—the content and platforms—on it.

9/ So when it comes to DAOs, the same is true.

“The DAO” happened 5 years ago in 2017. A lot has changed since then.

Now people think of DAOs for governance.

It’s very interesting, but that’s not only what DAOs are or where they’re going in the years ahead.

10/ We need to unpack DAOs—like crypto, DeFi, NFTs—and understand the *unique properties* they bring the world.

When looked at this way, people will see how revolutionary “DAO tech” will be.

It’ll expand the way we think about and define DAOs.

11/ DAOs as just a decentralized governance tool is a very narrow way to think of DAO tech.

When viewed this way, DAOs are only a tool for coordinating governance decisions over protocols, which today are mainly protocol upgrades and how project treasuries should be deployed.

12/ But DAOs are much broader in scope than that. And their implications are significant.

DAOs are tools for rapidly, efficiently & limitlessly coordinating human capital, resources, creativity, energy, compassion & output globally over the internet.

That’s a big deal.

https://twitter.com/syndicatedao/status/1378059738789781504

13/ DAO tech similarly possesses and brings many unique properties to the world:

- global
- open
- composable
- process automation
- rapid syndication
- rapid coordination
- rapid collaboration
- provable social connections
- provable behavioral histories
- collective ownership

14/ When framed this way, it opens the design space for DAOs—and more importantly, it opens people’s imaginations to what DAOs are for, what applications they have, and what their impact will be on our world and lives.

15/ Where are inefficiencies or limitations in coordinating human capital, resources, creativity, energy, compassion, or output globally causing really big problems in the world?

I’d argue everywhere.

- government
- business
- philanthropy
- investing
- art
- education
- etc

16/ So how do DAOs solve this?

Like every over tech in history: by being designed & applied to specific problems, in specific contexts, for specific users, with specific uses.

Specific doesn’t mean small.

Specific means focused. Specific drives adoption & real impact.

17/ User-centric applications powered by DAO tech are coming very, very soon.

And these DAOs—like DeFi and NFTs today—will have a massive impact in ways we couldn’t have possibly imagined.

18/ We should frame DAOs not as “decentralized autonomous organizations,” but instead as “decentralized automated organizations.”

This is closer to the potential DAOs have in our world.

If you’re working on this, join me & others to show the world what this can mean.

✺