Just DAO It: A Podcast for People Starting DAOs

Hello, everyone, and welcome to Just DAOIT,

the podcast for people starting DAOs.

I'm Adam Miller, and I'm your host.

This week,

we have Arnold Almeida on the show.

Really excited for you to

get to meet him shortly.

As always,

we're going to do the first half

of the show as the Just DAOIT News Report,

where I will summarize

recent DAO news for our

guests and for the audience,

and then we'll each give

our takes on the story.

What does it mean for people

starting DAOs?

Do we agree or disagree with the author,

etc. ?

So before we get to the news report,

Arnold,

would you please give a brief

introduction to yourself

and in particular,

what makes you an authority on DAOs?

Cool.

Thanks, Adam, for the introduction.

So I'm an Australian from Sydney,

living in London at the moment.

And back in the day,

I heavily got into Bitcoin.

In fact,

I invested in one of the first

sort of Bitcoin ATMs in Australia.

But guys,

don't worry about hacking me

because I spent all my

Bitcoin buying whiskey

sours at Room 77 in Berlin.

That's a little bit of the crypto history.

What makes me an authority on DAOs?

In the last three years,

I've spent my time coordinating DAOs,

writing over 30 proposals

and actually using the DAO

as a mechanism to rescue a project.

Through that experience,

that has led me to

learn a lot about DAOs,

participate in various different DAOs,

and form my own opinions

that has led me to build my

product at the moment,

which is Lighthouse.

But we can get to that later.

Interesting.

I have a brief preview.

What's the elevator pitch?

For Lighthouse?

Yeah.

Yeah.

Okay.

So Lighthouse is a tool that...

aggregates multiple DAO governance systems,

such as Snapshot, Open Zeppelin Governor.

And what we're trying to do

is make it really simple

for normal users who may

not be familiar with crypto

to learn and participate in DAOs.

Love it.

That's awesome.

Cool.

Well, as you know,

I have used Lighthouse

myself and I could see a

good use case for both

people new to DAOs and

helping them get into DAOs

and also for someone who's

very into DAOs already and

just trying to make their life easier.

We will dive into Lighthouse

in great detail in about

half an hour after the Just

Dawit news report.

And then also, in case anyone doesn't know,

you mentioned your journey

started in Room 77 in Berlin.

For anyone who doesn't know, what is that?

So Room 77 was one of the first...

Bitcoin cafes, I believe,

that actually accepted Bitcoin.

So I had initially bought Bitcoin over,

I think,

local Bitcoins through some funny

transfer, bank transfer,

or I think maybe even cash.

And I was traveling in Europe at the time,

and I stumbled across Room 77,

and they were like, hey,

we accept Bitcoin.

And yeah,

I spent the Bitcoin that I

purchased on a good

afternoon at Whiskey's house.

nice awesome all right cool

thanks arnold so again we

will get into in the

in-depth interview with

arnold about lighthouse and

his background uh just

after the news report so

for now let's dive into the

just out news report with

the first story of the week

which is a post on x and

the post is from uh crypto uh zainab

Maybe pronouncing it wrong.

There will be a link in the show notes.

And here's the post.

I'll read and then summarize.

In a world where DAOs are dull and boring,

one protocol dared to be different.

Dex Network.

And that's spelled D-E-X-E Network,

which is also a Twitter handle.

The DAO game changer you've

been waiting for is here.

So what is Dex?

Well, Dex is,

I'm just gonna continue

reading a little bit more,

an AI powered

permissionless launchpad for

building high level Web3

products across different chains.

It's got all the tools you

need to manage

decentralized communities

and assets like a boss.

DAO constructor on steroids.

Imagine Lego blocks, but for DAOs.

DEX has got a library of 50

plus smart contracts that

let you build custom DAOs

faster than you can say decentralization.

From governance to treasury management,

they've got you covered.

Governance that slaps.

Forget one size fits all.

With DEX,

you can create galaxy brain

governance models.

Use tokens, NFTs,

or even soul bound tokens to vote.

Mix and match like a true degenerate.

The post goes on,

the thread goes on to talk

about treasury management,

to talk about rewards in DAOs,

to talk about the native token of DEX,

this new protocol,

and also talks about the

importance of customization.

So I thought this was really

exciting because, and Arnold,

maybe we've talked about

this a bit offline,

but I realized recently

that in the three years or

so I've been in the DAO space, you know,

initially I was going to

build DAO tooling like Dex, right?

That was my plan.

I was like, oh, that's what DAOs need.

I'm going to go build it.

I saw a lot of people

building DAO tooling.

And then I came across the

opportunity to start my DAO

to focus on the legal side of DAOs,

legal entity side of DAOs.

But looking back,

I think I'm either

unimpressed by how much

progress has been made

or I'm not aware of the

progress that has been made

in the DAO tooling space, like for DAO.

And I don't even mean stuff

like Lighthouse that, you know, well,

we can talk more about that too,

but like platforms for

actually launching DAOs.

So I'm excited to see DEX again,

it's D-E-X-E network.

I'm curious to meet some

folks who have used their technology

It certainly sounds very compelling.

And I certainly think there

is a need for more DAO

platforms so that anyone

who's thinking about starting a DAO,

whatever the approach you

want to take for your DAO,

that you have a tool that

helps you do it.

Because most people are not

going to write smart contracts, right?

Most people that want to start a DAO,

either there's going to be

a tool that helps them do

it or they're not going to start a DAO.

They'll go do something else.

So I'm excited to see what

Dex is up to here.

What do you think, Arnold?

Yeah, I think...

It's definitely an innovation.

Composing DAO tooling is

actually very complex and

probably cost prohibitive

to a lot of people,

which is why in the last

three to five years,

there's probably only been

a small handful of players

who've been able to deliver

on that promise really well.

And there's a really great

divide in how people want to run a DAO.

At the moment,

you would say it's either

gasless or on chain.

And I think one of the

interesting points with

DexE over here is that they

are alluding to an AI automation.

So that is also signaling

this idea of a cybernetic organization.

But with a lot of turnkey solutions,

and again,

I haven't looked into this protocol,

so I may be wrong.

I think the way most

organizations are structured,

they're very diverse,

and each of the

organizations have their own objectives.

And as such,

they might have different

internal hierarchies that

need to be purpose built

for that organization.

So I think

Yeah,

it will be interesting if their suite

of smart contracts enable that.

And at the moment,

if we want to compare it to

what's currently on the market,

we are having to leverage

different protocols to

achieve the same outcome.

Now,

whether you think it's a good or a bad

thing, I'm not sure.

But I do believe in the

power of composability.

And as the industry matures,

we'll be seeing more things

that we probably want to

compose that haven't been thought of yet.

So that's my take on that.

Yeah,

it seems like everyone or most people

in the DAO space are

probably agreed on the

importance of composability for DAO tools,

right?

Whether you're building a

big tool with 50 parts,

And then maybe people want

to pick and choose parts

and bring in another part.

Or if you're just building a

component or a part or a

platform or a layer or whatever,

either way,

it seems like most people are

looking forward to and

building towards a world of

composability.

Have you found that with Lighthouse?

I know we haven't talked a

lot about what Lighthouse does,

but have you found that

when you want to...

support different DAOs from

different ecosystems that

the tooling is actually as

composable as it would ideally be?

I wouldn't say it's composable,

but so far we have

integrated with Snapshot

and we've done integrations

with DAOs that leverage

variations of the Open

Zeppelin governor contract.

And even within that space,

what we've actually seen is that

there is such a diversity in terms of how,

even just like snapshot, that's one tool,

but snapshot has this

interesting feature called strategies,

which means they can layer

different ways based on

that organization.

So for example,

you could have a root ERC20 token,

but people might also have

a staking token,

which gives them additional

voting rights and whatnot.

And that varies quite drastically.

So even when we did our analysis of,

the top 300 DAOs, for example,

there was such a diversity

in that small set,

which makes it quite a

challenge for an indexer

like ourselves to create

consistent tooling and

deliver a consistent interface.

So yeah,

that's something to definitely consider.

Yeah, interesting.

Was there also diversity in

terms of whether the top

300 DAOs are using a

platform at all versus writing,

even if they're using open source,

but writing their own smart contracts,

uploading their own Zeppelin contracts,

stuff like that?

Yeah, there was diversity there as well.

So a lot of,

even between straight up ERC20

contracts that had balance of,

a lot of DAOs,

because they had specific implementations,

they had custom contracts

and then there would be a

strategy that would sit on

top of that custom contract

in order to deliver voting power,

which is the sort of term

used to calculate how much

a person is allowed to vote

within the snapshot system.

Yeah.

Yep.

Cool.

Okay.

Awesome.

All right.

The next story of the week.

This is actually a press

release from Tally on Business Wire.

And the headline is Tally

unveils new liquid staked

governance protocol.

Token holders will be able

to stake in the Tally

protocol and receive a

Tally liquid staked token

that earns rewards,

can be used for financial

utility anywhere in crypto,

and allows them to maintain

their governance power.

So Tally is a one of the, you know,

I'll say clearly seems to

be one of the leading DAO platforms,

one of the leading DAO tooling providers.

I have to admit,

I've never come across a

DAO that I've been part of that,

at least to my knowledge, is on Tally.

Maybe they use Tally in the

background and then you

just don't see it in the foreground.

But they're everywhere.

I mean, you see them sponsoring big events,

you see announcements like this.

So I think they're doing a lot.

And part of this

announcement is that

they're not just doing this

for themselves in terms of

allowing for staking.

This is a feature anyone can

use now who's building a DAO on Tally.

And so another good example

of more capabilities being

added to DAO platforms and DAO tooling,

certainly very exciting.

And I think staking is a

good example of the kind of

mechanism that I don't

think existed before crypto,

before DAOs in organizations, right?

Like Microsoft never said, well,

if you take your Microsoft stock

and you stake it and you

lock it up for a year,

we're going to give you a

discount on your next

Microsoft purchase or startups don't.

I mean, you're either in or you're out,

right?

You have stock or you don't.

I don't think there's ever

been an equivalent to staking,

but it's one of the things

that people are doing a lot

of experimentation with in

DAOs and crypto and this

concept that there's a

potential difference

between a person who just

wants to hold a token

And then maybe a person who

wants to stake it and lock

it up or do something else with it.

So I think this is really cool.

What do you think, Arnold?

I thought it was extremely interesting.

For the first time,

we can still maintain voting power and.

effectively have a means of

re-hypothecating the token

which can then be used for

additional yield now that's

very complicated and I'm

not really sure how that

translates to security look

security laws or whatnot

but I think we've seen

examples of this with curve

um when you sort of lock

your curve tokens and then

you get ve curve which

gives you a boost on the

sort of governance voting

power I think if I'm if I'm

sounds right yeah so

there's definitely an

upside where you retain

your voting power um but I'm just

Yeah, it's a new model.

I don't know what's going to

come out of it,

but it's an interesting experiment.

So really excited to see

what happens there.

Yeah,

and I guess maybe it's as simple as just,

in some cases,

if previously you might

have staked a token and

you're just giving it to a smart contract,

and now you no longer have

a standardized token

form representation of the

fact that you have staked

in that smart contract.

You just don't have your

token anymore now with this

kind of liquid staking

feature and not that it's

new and the others have it,

but now you're getting a

representation that you

have done that staking.

And so then you can go use

that representation,

that representation form

in other ways, borrow against it,

or sell it, or whatever.

So that seems generally good.

But actually,

let me use this as a segue to

the next story of the week,

because we actually have a

story about Curve.

And let me start by reading the headline,

and then I'll connect it

back to what we were just talking about.

So this is actually from a

website called Blockanami.

The logo looks a lot like Blockworks.

I'm kind of curious if maybe

there's a connection here.

But the headline is,

Curve DAO token CRV price

plunges 30% amid founders liquidation.

The price of Curve DAO token

plummeted by nearly 30% as

Curve finance founder

Michael Egorov faced

liquidation on his on-chain

loan positions.

Okay, so what happened here,

and this is actually,

this story has come up

before at least once,

I think about half a year ago,

the same thing happened.

And what's happening is one

of the founders of Curve,

who holds a large number of the tokens,

took those tokens and

borrowed a ton of money against them.

And this is all out in the open,

which is good,

although I'm not sure if

anyone really noticed it at first.

But what happened was the

value of the collateral

fell enough that there's a

risk that the Curve DAO

founder's tokens are going

to get liquidated,

which means the Curve

tokens could get liquidated.

They could get forcefully taken from him.

I mean,

they're already locked in smart

contracts.

taken away from him and then

sold on the open market,

which will drive the price

of the Curve token down.

So the reason I say this is connected,

I guess actually in this case,

you don't even need liquid

staking to make this happen.

You're actually just taking

the governance token and

borrowing against it.

But the liquid staking example

seems to be just kind of

another way of

financializing something so

that you can do this if you want to,

right?

Whereas before you could

have a DAO that says, all right,

by staking your token,

we have your token.

Now you cannot go borrow

against it because we have it, right?

And it's ours until you take it back.

You can't do anything with it.

Now,

if you provide a liquid staking

derivative or token in

exchange for that staked token,

now you have something you

can go borrow against.

So for better or for worse,

you're kind of

reintroducing that

financial nature of that

arrangement that you have with the DAO.

But again,

this story is more just about

something that I don't know

how we could ever get away from.

And I don't even know if

there's anything wrong with it.

I mean,

how do you get away from the fact

that sometimes you're going

to reward people with a lot

of money or a lot of shares

or a lot of tokens,

and then that person might

go sell them or borrow against them?

I think this is like a

really good lesson in accountability.

should any one person

regardless of their status

within a protocol have the

ability to single-handedly

crash a protocol and this

is really a lesson in risk

management I would say so I

think we could use this as

just a lesson for how we can

build better checks and

balances in the future to

minimize this risk.

I'm not saying that what he did was wrong.

It's just that let's also

bear in mind like Curve is one of the

most interesting and most

innovative protocols that came out.

And at the time,

we probably weren't

thinking about how this could be done.

And really, credit to,

I believe it was the Aave

team who signaled and first

identified this existential

risk and created

but perhaps some proposals

to guard against that.

And also to, I believe, Michael's credit,

he also was trying to fix it as well.

And I think there was

perhaps a commitment to

ensure that if that did happen.

So I think people are working against it,

but I guess this is one of those things,

it's a lesson learned and

let's guard against it in the future.

Yeah.

Yeah.

I mean,

is there any way to guard against

founders taking a big cut?

I mean, I feel like now with crypto,

we have founders taking a smaller cut,

which is good.

You know,

maybe previously the average whatnot.

I mean, every situation is so different,

but maybe a normal cut.

corporate startup,

the founders might end up

with half or a little bit

less of the company in the long run.

Maybe less if you end up

actually like going public

and stuff like that.

I think in crypto,

it's more common to see the

founders taking like 15% or so.

Although you may have like

the actual founders at 15%

and then the investors at

15% and then like the early

contributors at 15%.

And now maybe you could

argue that in some ways the

founders have half

if it's just a bigger definition,

a wider definition of the word founders,

but it seems like we're

moving in the right direction, but I mean,

will we ever get away from

founders having 10 or 15%?

And therefore that's enough

that if they do something

stupid in their personal life,

it could tank,

it could harm the whole project.

i think just this comes down

to value alignment so I

think in the last cycle um

it's quite common to see

that traditional pie chart

with the 15 advisors

insiders and whatnot but

what that really does it

creates misaligned

incentives because you're

raising a lot of money up

front and again we come

back to the idea of accountability

So if we are emitting or

creating those tokens at

the token generation event,

and even with unlocks,

which are traditionally, let's just say,

I believe like one year or even less.

If you look at traditional analogs,

like most people,

most founders don't have a

lot of the equity vested

until three or five years.

So I think...

if we start just

re-examining how we can

have more sustainable

emissions and how we can

align that with

deliverables of projects

again we can have better

outcomes for industry

because there's a lot of

great ideas and there's a

lot of capital floating

around but I think a lot of

people have been really burnt by the

promises that people have

just failed to deliver.

And that creates real

barriers to entry for

people who are trying to do

good things and as such

can't raise capital because

of these bad experiences.

Yeah.

Interesting.

All right.

Let's turn to the next story of the week.

This one is another post on

X and it's from A16Z Crypto

from the former Andreessen

Horowitz venture capital firm.

And the post is interested

in learning about DAOs.

Here are some resources, a thread.

So this thread,

I'm not going to go through them all,

but I just actually want to

call people's attention to

this thread because they've

written a lot of really

interesting articles about

DAOs from different perspectives,

ranging from research on

experimenting with governance.

Certainly one of the really

interesting things we're doing with DAOs,

you could say we're

experimenting with organizations.

or the governance of organizations,

but also governance in general.

The things we're learning about democracy,

the things we're learning about voting,

the things we're learning

about how groups of people

coordinate on a global

scale digitally can be

applied to any time we're

trying to govern anything,

not just organizations.

And so I think that's one

really interesting article.

Relatedly,

one article is about using DAOs

to study political institutions at scale.

So I think that's related and interesting.

The effects of retroactive

rewards on participating in

online governance is a video.

The DUNA, an oasis for DAOs,

is an article about a legal

entity called a DUNA that

was created by some of

ASICC's lawyers in Wyoming that goes live,

I think, in a few days.

And designing reward systems

for Web3 governance.

the evolution of decentralized governance.

And then one I just wanted

to call out in particular

is called Machiavelli for DAOs,

Principles for Fixing

Decentralized Governance.

And I actually have not had

the chance to read it yet.

I have to admit the whole

A16Z blog is in all caps

and it is hard for me to read.

And I actually sent an email

one time to one of the authors, like, hey,

do you realize your article

was accidentally published all in,

it's not all caps,

it's every word is capitalized.

It's just, I don't know,

hard for me to read.

So I haven't read it.

But I love the idea of just saying,

I think Machiavelli was

someone who's known for being

harsh and even cruel, but I think at least,

especially from a deep

philosophical perspective,

I think it was trying to be

very logical and rational about, hey,

let's look at the

incentives of the different

people in the system.

Let's look at how human

behavior really works.

And then let's design our

systems to get the outcome that we want.

And then some people would say, well,

that's cruel.

Why aren't you designing

systems for more of a

social good perspective or something?

Although I think you could

do that in a Machiavellian way too.

So I'm looking forward to

reading it in more detail

and seeing how you can

apply Machiavelli to DAOs.

And again,

just recommend people check out

this thread if they're

looking for more resources about DAOs.

Arnold,

anything that stood out to you

about this thread or any of

the articles they posted?

Yeah, look,

I love all the A16Z DAO governance stuff.

I'm also a big follower of

all the governance

literature that comes out

of Optimism as well.

But one of the things that I

find when I'm trying to DAO

pill people is that a lot

of this literature is quite dense.

And for people who are embedded in,

I guess,

traditional thinking or

traditional structures,

my favorite go-to is an

article that came from the

World Economic Forum.

It was published in January 2023.

And they have a really good primer.

And it's a good segue to illustrate that,

hey,

there are serious organizations

thinking about DAOs.

these are the problems that

are identified.

And that usually is a good

precursor to then landing in like, hey,

what should I read next?

And then, yeah, going on to the A16Z,

more hardcore theoretical stuff.

So that's how I usually doubt people.

I love that.

And I remember talking about

that World Economic Forum

report on the show some time ago.

And I'm looking at I think

there may have been even more than one,

but I just pulled it up

while you were speaking.

There's a one paper they

wrote called Decentralized

Autonomous Organization Toolkit.

from January of 2023.

And the contents are, what are DAOs?

Why do they matter?

How do they work?

How are they governed?

What are the legal structures and issues?

This whole thing was written

from a policy perspective.

So the in conclusion is,

what are their

recommendations for

governments and for other policy?

But yeah, really interesting.

I never would have guessed

and I had forgotten that

the World Economic Forum

could publish such an

interesting and useful

report,

but I think they clearly have done so.

So that's a good recommendation.

Yeah, I think like

The fact that they're

thinking about this already,

I personally believe that

DAOs have an end game in

civics and public policy.

All the work and research

that we're doing now and

the experimentation,

I think eventually will

trickle down through to

local and federal governments.

I don't know on what timescale, but yeah,

that's what I guess

motivates me to do a lot of

the work that we're doing.

It's really interesting.

You know,

when I think about like

governance in my life,

I've got as an American,

I think most people have the same stack,

which is you've got your city,

your state and your federal government.

And each of those will have

an election up to once a year.

Of course,

there are other ways of

participating other than

just voting in the election.

And then I think many people,

myself included at least,

are involved in governing

some nonprofits or just

like community-based organizations.

You know, we have on the island I live on,

We have an unofficial

homeowners association

effectively where I'm on

the committee and we make

decisions together and then

a couple of nonprofits I'm involved in.

And it all feels relatively

manageable because there's

not a lot of it, right?

It's like these three

geographic groups and then

maybe a few nonprofits and other orgs.

I find the challenge that

I've had in the DAO space

is that you end up wanting

to be part of a lot.

Because the cost of entry

and the cost to participate

at some level is so low.

You just go buy an NFT or

buy a few tokens or just

join a Discord or hit a

button or whatever it is.

Now you're part of an organization.

Now you have voting rights.

And that clearly demands a

new approach to how we

think about the things we

govern in our lives and how

to keep track of them,

how to participate in them efficiently.

And it does seem clear that

that will be applied to

these traditional forms of

governance and that that

might actually allow us to

participate in many more

forms of governance in our lives,

even the traditional form.

I mean,

once city and state governments and

your average day to day

nonprofit or community organization,

certainly once they're all on chain,

now they get to take

advantage of all the cool

stuff we're building for

DAOs and on chain governance.

And that should make them

easier and more pleasurable

to be a part of.

Yeah, no, for sure.

I think the fact that we can align,

at the moment, cultural interests.

So if you're involved in artists, manga,

music,

these are all great petri dishes

for how we can sort of see what works,

what doesn't.

And yeah,

I think this is a great time for

experimentation, and we really want

to sort of enable people to

start these communities.

And we have them already.

Like we have little skating skate clubs,

or if you're part of a local co-op,

even like a gardening

center where you have a community garden,

you manage finances,

you're trying to work out

who gets the next plot of land.

All these things apply to

have an analog to a type of DAO.

So yeah,

I'm just really excited to see all

the different types of

things that manifest.

Cool.

All right.

Turning to the next story of the week.

This one is from altcoinbuzz.io.

And I'm noticing the lowbrow

nature of a lot of the

brands we've been quoting from today.

But hopefully they're reliable.

Either way,

I know there's some truth to this story.

I've seen it other places.

The headline is Julian

Assange freed with 11k ETH.

Assange DAO's victory.

Actually,

there's things here I don't know

if I can trust and things

that I know I can trust.

And so I want to dig into those.

But the subtitle or the

subheader is Julian Assange,

the founder of WikiLeaks,

has finally achieved freedom,

largely due to the generous

contributions made by

supporters to the Assange DAO.

OK,

here's the part that definitely is true,

is that Julian Assange

reached a plea deal with

the United States

government a few days ago,

maybe yesterday.

I'm not sure.

Recently,

where he basically he's pleading

guilty and his plea deal

was he only has to serve

the time he already served

in jail in the UK awaiting

the decision on his extradition.

And so effectively now he's free.

It's over.

The part about this article

that even the article says

it doesn't know for sure.

So I'm surprised that the

headline makes it sound so

confident is actually

someone posted on X saying

time for the organization

that raised all this ETH

and supposedly was helping

free him to tell us what

they've been up to this

whole time because we have

no freaking clue.

And I brought this up on the

show a couple of months ago, too.

tens,

hundreds of millions of dollars

raised to this legal fund.

And there's no transparency.

No one knows who's in charge.

No one.

I mean, maybe someone does, actually.

If you do, obviously, please tell us.

But there's been no

transparency as to where

all this money went and how

it's being spent.

And so I think, actually,

we have no clue if this

16,593 Ethereum had

anything to do with freeing Assange.

I sure hope so.

I think I contributed to it.

I

contributed to some stuff

like that so I'm really

curious to see what we find

out in the coming weeks but

I wouldn't be surprised if

there ends up being some

kind of conspiracy here you

give someone that kind of

money with no oversight

even if it's on chain and

it's just and actually I

think I think we know that

a lot of it was spent I

think we just have no clue

where it went where did it

go yeah for sure

So I think, well, firstly, let's just,

I guess, celebrate the win.

So if Assange Dow actually

did contribute to...

Julian Assange's release

because let's just say that

they knew he had the

capital to fight them

legally indefinitely.

That's a really interesting

example of how

decentralized coordination

can work in our favor.

Now that it's achieved its primary goal,

this is really interesting

because DAOs are

in permanent structures.

So the question is, how do they wind down?

How do they report on where

the money was spent?

Maybe they couldn't report

on how they were fighting

or doing certain things,

because that could have

jeopardized the legal case.

But let's try and be

optimistic in the sense

that they will have some

sort of transparency.

They will use the funds to

provide a breakdown and

then wind it down in a way

that gives the company

additional credibility.

Because if they don't, we don't want that.

Yeah,

maybe tens of millions of dollars

potentially

misused but you're right we

should assume the best I

just I don't know I mean

should we really assume the

best I just feel I feel

like we get burned a lot by

doing that um and is what's

is there really an argument

why they couldn't have been

transparent this whole time

like what tell it like

telling the world we paid

this law firm to to go

fight for assange is going

to cause a problem for the

lawsuit I just find that to

be a bit of a stretch

we don't know we can

speculate who knows what

hands were greased um who

knows what strategies

needed to be in place um

maybe they'll make a

documentary and a movie out

of it and maybe from that

will go towards fighting

you know um other activists

who deserve not to be in jail

Yeah.

Yeah.

Makes sense.

You know, all this reminds me too, that,

you know, and we used to,

I used to talk about this a

lot on the show two years ago was we, we,

we hear about, Oh,

like Assange Dow raised whatever,

10,000 ETH, but then is it really a debt?

And at the time, especially, but even now,

you know,

a lot of times people raise money into,

let's say a juice box,

especially at the time.

Although I think people are

certainly still using juice box, but

You can set up a juice box

so that all the money just

gets sent to me.

Right.

And so just the fact that

you're on juice box and

saying raising money for Assange now,

that is not enough

information to know that

you can trust where the money is going.

You know,

you've really got to do your due

diligence and know what

you're getting into.

And so, you know, just I mean, I'm curious,

you know,

supposedly there was a multi-sig.

Who was on the multi-sig?

And even if it's a multi-sig

of three people,

should they ever have called that a DAO?

Was that really a DAO?

Or were you just giving

money to a foundation that

was going to... Just

because it's in crypto,

it doesn't mean it's a DAO.

Yeah, that's true.

Actually,

that reminds me of something that

I read recently,

maybe in the last week or so.

And I think it was to do

with the Indian COVID Relief Fund.

And a lot of money was donated there.

um to that fund to help um

india and one of the things

that was interesting is

that in order to sort of

promote transparency they

employed one of like one of

the big three accounting

firms kpmg or someone else

ey and they have a report

that is published on a

monthly basis to

demonstrate where the money

is being spent

So I think that's a really, if it's true,

please fact check me.

But I think that's like a

really good initiative when

big fundraisers like this happen.

And yeah,

people can see how the money is

being allocated.

Yep.

All right, let's turn to the next story.

This one is from the Dow Times,

which I highly recommend.

And the story is, the headline is,

Hedera Abandons Decentralization,

Removes Community Nodes from Roadmap.

Okay,

so Hedera is a very math-oriented

blockchain.

They're all very math-oriented,

but Hedera is like a

supposedly super high-tech blockchain.

It's faster, it's different.

uses a different underlying

consensus technology or at

least data technology called a DAG,

a directed axillic graph.

And it's been in development

for a long time.

I don't know if they get a lot of usage.

I might hold some of the tokens myself.

I think I've always been a

little bit optimistic about

what they might be able to achieve.

But anyways,

the story is about how today

the network is operated by

31 multinational

corporations hand selected

by the Hedera Foundation.

And they had on their

roadmap until recently that

soon they were going to

introduce many more nodes

run by the community as

opposed to these

multinational corporations.

and and I just put the

community in air quotes

because I think that's you

know it depends how you

define it I mean those

corporations are part of

the community too um but um

clearly they were planning

on giving control over the

network to a wider group of

people and they removed it

from the roadmap so of

course we don't have all

the details maybe it's

going to go back on the

roadmap tomorrow but what's

interesting to me about

this is just a question of isn't

running something

collaboratively on a

blockchain between 31

multinational corporations,

actually a huge step in the

right direction.

That's actually way more

decentralized than one

company running an entire system,

which is how everything

always worked until now.

I mean, yeah, you could argue, yeah,

it's one company,

but there's like five

intermediaries and there's

reconciliation.

Yeah,

all of that is because we can't trust

that one company,

so you need all this other

stuff going on.

Spreading out,

think of the blockchain as

an alternative to AWS.

It's obviously not exactly that,

but in this case,

it's either you're running

the whole system in AWS or

you have 31 different

companies running it using

a consensus mechanism on a

blockchain where everything, by the way,

can be validated by anyone

who wants to use the blockchain.

It's just the 31

organizations are the ones

choosing the transactions

and building the blocks and

stuff like that.

To me, that's actually quite good.

That's what I wanted to

highlight about this is

that it's actually there's

a lot of power.

I think same goes for Solana, by the way.

And I don't remember.

I've never been as into Solana.

I certainly hold the tokens.

I'm a believer,

at least for the past year or two,

if I wasn't before.

But Solana, too,

has run on a relatively

small number of nodes,

probably Binance Smart Chain, too.

But I think it's still...

30 or 100 or a few hundred.

And that's orders of

magnitude more

decentralization than any

piece of software that came

before the blockchain.

So that's the point I wanted to make.

But Arnold,

if you want to respond to that

or anything about this story.

Yeah,

I don't know much about Hedera

specifically,

but to your point on 30

nodes is better than one,

I totally agree because

What that gives us is the

ability to verify that the

information that's being

put out there is indeed accurate.

And that goes for any type of data, right?

So just using, I guess,

my product as an example,

I have to index a lot of

on-chain proposal data, voting data,

and I need to service that to my users.

you know,

what's stopping me from maybe

injecting the wrong

sentiment and whatnot.

I'm theoretically proving

and aggregating all that

information from the blockchain.

And in theory,

anyone else should be able

to reproduce that and

provide a similar proof.

So even if it's not

decentralized in the sense

that there's 100 nodes or 200,

as long as there's more

than one actor being able

to sufficiently prove the

authenticity of that data,

I think it's a good thing.

Yep.

Yep.

Love it.

All right.

Let's do one more story for the week.

I've got a pick from the two

I had on my list.

Let's do this article from

friends with benefits, FWB dot help.

I think that's friends with benefits.

Yeah.

Yeah.

Friends with benefit websites.

That's,

this is their blog and by Austin Roby.

The headline of the article is, uh,

what co-ops and DAOs can

learn from each other.

The best framework for

coordinating and making a

difference may not be a

choice between the two models,

but a blend of both.

So we actually,

Arnold and I happened to be

on a different DAO related

call earlier today where

the topic came up of co-ops and DAOs.

And...

You know,

the point I was making earlier

was similar, I think,

to what's in this article,

which is DAOs and co-ops

are two different things.

But sometimes you have a DAO

that is a co-op and

sometimes you have a co-op that is a DAO.

You can also have a DAO

that's not a co-op.

You can also have a co-op

that's not a DAO.

And in particular, to me,

the biggest difference is

that what makes a co-op is

like a particular kind of philosophy.

It's a particular legal

structure in a lot of places where...

Ownership is distributed a

very particular way.

Governance is done a very particular way.

And most DAOs just don't do

things that exact way,

even if there's a lot of

kind of overlap in some of

the values between the two communities.

And some DAOs do things that way.

And similarly, most co-ops are off-chain.

I mean,

most co-ops have been around for

hundreds of years.

in various forms,

most of them are just purely on paper.

And I see no reason to call those DAOs.

They're just co-ops.

If they want to come use

on-chain smart contracts to

do their token to track membership,

I'd say, yeah, now it's a DAO.

I think you have a different opinion,

didn't I?

I think you did have a different opinion,

so I definitely want to

give you the chance to share that.

But to me,

the most important thing to

maybe emphasize here is

there is a history of

people trying to build more democratic,

more fair,

more social good oriented types

of organizations.

And some,

maybe much of what's happening in

the DAO industry and space

is related to that movement.

But I would say also a lot is not.

To me,

I think that's the most important thing.

But yeah, Arnold, do you still disagree?

Do you have a different way

of looking at it?

I mean, disagree is a strong word.

I just have, I guess...

a different angle, right?

I do believe that co-ops

provide a really good

analogue for how we can think about DAOs.

DAOs in comparison are

relatively new and some of

the principles that you've

mentioned that are defined

in co-ops may not necessarily be

alive in DAOs yet just

because we haven't gotten to them yet.

So, for example,

I'm going to reference an

article from Andy Aghast

from Hyper Co-op.

She wrote a great article on

seven cooperative

principles and how they can

translate into DAOs.

And in my opinion,

I think they do have a

almost one-to-one analogue

with DAOs from that co-op paradigm.

We don't necessarily have

all those principles

manifesting in tangible operation manuals,

but I think it's something

that we can use as a

handbook to strive towards.

Cool.

Yeah.

Yeah.

Makes sense.

And all right.

Well, so with that,

let's let's conclude the

just out news reports.

I'm going to do a brief segue,

including a brief ad,

and then we will turn to

the featured guest

interview with Arnold at last.

And we'll learn more about

him and his work in Web3.

The brief ad is for my company, MyDAO,

is the sponsor of the show.

MyDAO is the company that

works with the government

of the Marshall Islands,

a sovereign nation in the South Pacific,

on developing what we...

The goal is to make it the

best legal entity and legal

framework in the world for DAOs and Web3.

So if anyone is thinking

about where to form your

Web3 or DAO-related...

a company, where to form your legal entity,

please reach out to us at MyDAO.

You can find us at mydao.org.

That's M-I-D-A-O.org.

And similarly,

if you're looking for a lawyer,

so we're not lawyers,

but if you're looking for a

lawyer or a tax advisor or

any other kind of professional advisor,

we have a network of folks

all over the world who may

be able to help your DAO or your project

uh with web3 tax legal etc

happy to get people

connected with that network

so feel free to reach out

about that or if you are a

lawyer or tax advisor also

please reach out about

getting added to the network

With that ad out of the way, Arnold, okay.

Thanks for participating in

the news report.

I'm sure we'll find ways to

tie our conversation back

to some of the things we read.

But meanwhile, let's take a step back.

And would you tell us a bit

more about how you got into

Web3 and DAOs in the first place?

sure um I think I covered a

little bit of that um

earlier on but yeah so I

specifically got into web3

when I first read vitalik's

sort of promise of ethereum

as a world computer and for

me that really

opened up my mind in terms

of how as a systems designer,

so I've been a sort of CTO for 15 years,

love complex systems,

and I've always been like

having to write

integrations between multiple systems.

But to

think of a smart contract

being able to trustlessly

interrupt with another bona

fide system and not have

any human intervention,

that really sort of blew my mind.

So that's what really sort

of Ethereum pilled me.

And because of that,

I just started exploring

what people could do with Ethereum.

And over the years, that led me to

Yeah, start exploring smart contracts,

playing with voting systems,

riding bridges,

just seeing what it could do.

And the thing that actually

got me into a DAO was I was

working on a project where,

let's just say,

the founders abandoned it

and the community needed a

vehicle to really coordinate.

And because I was very interested in DAOs,

I'd seen how MakerDAO was operating.

I think Optimism just launched.

I was saying, hey,

this could be a really

useful experiment for us to

be able to coordinate and

align what we believe

should happen with this project.

And as such, I created the DAO vehicle.

And over the course of that project,

I led over 30 proposals

that covered creating constitution,

tokenomics, and

that was you know extremely

tough primarily because uh

we're in a hostile

environment people had you

know I guess different

opinions and that really

sort of taught me gave me

across a crash course and

like well how do we

coordinate the sort of

flurry of opinion and what

processes and procedures

can we have in place so

that people can coordinate

in an effective manner

And it was through that

experience that led me to

sort of conceptualize Lighthouse.

The key thing that I guess

was a launchpad for

Lighthouse was in that previous project,

I needed to send a message

to 100,000 holders, right?

And at the time, two and a half years ago,

well,

how do we actually- Like the token

holders of the DAO.

Uh, not, they,

they weren't a Dow at that point.

They were just people who

owned a token at some point.

So there were just people

who bought it from a smart

contract or from a unit swap pool.

Um, so at that stage, well.

You could either send an on chain message,

but who's actually going to

read a blockchain message

on AetherScan decode that?

Mind you,

this wasn't the height of the ICO craze.

So again,

let's just say that the people

who had the token probably

wouldn't have been looking in that area.

The other option was, hey,

we could add up an NFT with

a message saying, hey,

we need to do this because

we're going to be

converting into a DAO and

we need you to take these

options on any of the chains.

That is going to be a huge cost,

especially at that scale.

And if you're sending messages

at scale,

how do you sort of differentiate

yourself between people who

are legitimate authors in

the project versus people

who are impersonating?

So there's another sort of

edge to the problem.

And it was through that reasoning, yeah,

I came up with Lighthouse, which is, okay,

how can we use

EOA's smart accounts as a means to signal,

okay,

we know that these addresses are

associated with the project.

And when we transmit

messages from these accounts,

we know that they are, for the most part,

authenticated.

But

we know that, well,

most people aren't

necessarily going to be

receiving these messages on

any of those aforementioned platforms.

And even if we were trying

to direct them to a

purpose-built website,

Again,

it requires a person to proactively

go to that website.

So it's quite obvious to me that, well,

everything's always

competing for attention on mobile.

And because of that, I guess, idea,

I was like, okay,

in order for this to work,

we do need to have a

dedicated mobile client

where people who are

genuinely interested in

following a project

can have a narrow

purpose-built client that

is very different to having

to participate in the noise

from any of the traditional

channels such as Twitter, Telegram,

or Discord.

And as we know,

for anyone who participates

in more than one project,

um it can be quite noisy

like in my discord I've got

I think 100 dows or let's

just say communities that

I'm a part of and it is um

even if I want to it's

going to take me a few

hours to get through

everything so um using that

as a sort of basis um I

yeah develop lighthouse as a narrow

governance focused clients

so people who are genuinely

interested in following and

participating in uh actions

within the community they

can do so during that via

that mechanism yep

interesting so okay so

you're saying if I have a

dow and I want to have an app

on people's mobile phones

for my DAO so that they

will get messages related to that DAO.

That's something that

Lighthouse is helping them do,

is that right?

Yeah, that's correct.

At the moment,

we support all the Snapshot DAOs.

If your DAO or community is on Snapshot,

you can add them to

Lighthouse or I can do that for you,

just message me.

And whenever a new proposal is put out,

you'll get a push

notification and you can vote in that.

So that means you can sort

of completely avoid having

to go to any of those other channels.

You can trust that it

actually came from the

project owners and it just

gives you a bit of peace of

mind that you're

interacting with the correct information.

That was obviously easy

because Snapshot provides

great APIs for that.

But the next challenge for us was like,

okay,

in order for this to actually work

in scale,

we needed to work for the bigger

DAOs that are running on custom contracts,

such as Optimism, Governor,

such as optimism, nouns, et cetera.

So we spent some time

working out pipelines to

support those DAOs.

And now you can actually follow optimism,

stay up to date with nouns,

and have those proposals

delivered straight to your mobile phone,

which is really interesting.

And one of the interesting

things through that exploration

a lot of these proposals or

a lot of these governance systems,

they actually allow you to when you vote,

provide a comment or a reason.

And at the moment,

in the majority of systems,

I would say that a lot of

that high signal content is lost.

So the way we designed

Lighthouse was more like a

social platform where

when you look at a vote you

see the results

additionally you will see

the comments that people

have spent time putting

their opinion forward on

and that adds to a really

interesting experience and

makes the community feel much more alive

So is it one app that brings

in a feed from all the DAOs

or it's an app for each DAO or both?

At the moment,

it's one app that works with

all the DAOs with a view of

being able to support any

DAO on any EVM chain at the moment.

I've been speaking to Solana

people as well.

I'm a strong believer that

governance is one of the

sort of end games of crypto

and that is um regardless

of which tribe we belong to

um because you know crypto

primitives allow this great

tool for coordination and

um you know regardless of

what system we're on uh we

just need to be able to

coordinate effectively

Yeah, it's a good point, man.

I feel like crypto is if you

look at it in a very like

almost like historical,

philosophical or anthropological lens,

it's just a coordination

technology for people.

Right.

Although going back to your earlier,

you mentioned that one of

the things that got you

excited about DAOs was the

potentially autonomous,

not even the way we usually

use the word autonomous,

but that you could have a

real autonomous agent

living on the blockchain

with its own money doing its own thing.

I wonder if that breaks the metaphor,

but I think otherwise

crypto is a coordination

technology for people.

And part of coordination is governance.

Maybe it's just a subset or

one component of what coordination is,

but certainly it's one big part.

No, most definitely.

And I think that's a really

interesting point.

So I think a lot of the DAOs

that are present at the moment,

they are either social DAOs

with human actors.

Actually, they all are.

But if we look at the types

of proposals that are being executed,

especially when we look at protocol DAOs,

a lot of the protocol DAOs are more

optimize for configuring

like fee parameters or

mathematical concepts, right?

And I would argue that over time,

as the proposal data and

the outputs from those

information and from disparate systems,

we're more likely to see

autonomous agents or

autonomous proposals become a thing.

people can focus on human things.

But just given the way it is at the moment,

yeah, they're all human-based.

Yep.

Interesting.

Okay, so first of all,

can you tell us more about

the DAO that you started

and worked on and did the 30 proposals?

Is it gone now?

Is that why you don't

mention the name or...?

It's not gone, it still exists.

It's a DAO called Not Safe for Work,

which is controversial

because it is an OnlyFans-based DAO.

It was one of the first

head-up DAOs that came on the market,

I think were the only ones left.

I think a lot of them sort

of like came and went.

yeah it was an example of

really putting into

practice a lot of the

different theory and um

yeah it's it's a community

that has these really

interesting ideas I had to

learn a lot it's not my

industry but you know I did

speak to great people from

um there's a person called

briny cole she runs a

podcast called the future

of sex and it's all about

sex positivity uh empowerment

And the reason why I did

work in that space is

because if we look at sex

workers or even just

creators in that space,

they are actually one of

the most underserved people

when it comes to financial institutions.

So crypto is a real way for

them to be able to take

control of their own narrative.

And instead of being able to, I guess,

like my process when I was

working and creating these

systems was like,

we can do this ethically

and fairly and create

systems that are self regulated.

So instead of a small corporation who has

very outsized or different incentives,

we can have a DAO that's

owned and operated by the community.

And it's not governed by any under,

it's not governed by a

small group of people.

So yeah.

Yep.

Cool.

Okay.

And so coming from that experience,

starting a DAO, working on a DAO,

and now working on a DAO tool,

what have you seen over the

past few years being super

engaged in the DAO space?

uh what's what has surprised

you what stands out to you

and really I think part of

what I'm trying to get at

is like what are dows doing

right or doing wrong that

that really stands out I

mean what are you seeing in

the dow space to help us

get a sense of what's going

on in the dow world today

yeah it's it's a loaded

question I think a lot of

there's a lot of great

innovation and

experimentation happening I think um

fractional ownership is really interesting,

on-chain commitments, because again,

I think a lot of,

and I've mentioned this a few times,

accountability is one of

the best things that DAOs

offer to people because it

gives any individual a sort

of a genuine transparent, well,

the possibility of a very

transparent organization, right?

And how people are elected, how...

roles are surfaced and their

responsibilities,

they are no longer opaque.

And it means that

individuals can rotate

between roles and

responsibilities a lot easier.

So I think already,

I know that sounds a little bit vague,

but for example,

I really love the idea of seasons.

So DAOs are really time consuming.

They involve so much

commitment mentally and

physically to run town halls,

gather feedback,

make sure that things are presented.

um in the right manner

because dao's are a diverse

group of people um hey it's

not only english we've you

know I've had to deal with

well how do I make sure

that this is also relatable

and understandable to

people of different

languages as well and are

we communicating things

effectively in the correct

manner um so yeah I think

there's just a lot

that's happening in DAOs.

I think everyone's trying

their best to make sure

that everyone's aware of

how things operate,

but we can always be doing

better jobs at that.

Yeah.

Is there a common theme that

you see in terms of what

problems are showing up for DAOs today?

I mean, clearly,

you guys are going after

one of those problems,

which is communicating with

your users about important

messages and proposals.

But I mean,

is that is that something that

like every day I was like, man,

I can't keep operating if

we don't have a better way to do that.

One 100%.

So a lot of the user research that we did.

So

For people who operate in

like one or two DAOs,

it doesn't really matter as

much because again,

the highly engaged doesn't

take that much effort to stay up to date.

But the second you're at three plus,

it becomes a real burden,

especially when you think

about the meetings you need to attend to,

discussions, proposals.

So part of why I built

Lighthouse is to really

sort of streamline

that downstream effect of

information so that they

have people have one place

they know that okay cool

I've got a meeting tomorrow

I can attend that then I

can vote and the proposal

aspect of what I've

described so far is just

the first part of what we

are planning to build we are planning

just ways to streamline the

contributor fatigue so that people,

specifically delegates who

sit on genuinely five to eight DAOs,

they can just have an

easier time being able to

participate and actually

spend their time thinking

about the proposal at hand versus, oh,

I'm running late to this.

Yeah.

Hopefully that makes sense.

Yeah, it makes sense.

I mean, I feel like

one of,

if not the most common challenge

that I see coming up in

DAOs is communication in general, right?

Where do we communicate?

And it seems like you're going after,

maybe we could call it like

the communication between

the DAO and the community.

But then there's also the

question of just how does the community,

how do the DAO members talk

to each other?

How do the teams communicate

with each other?

Do they use Discord?

But there's a lot of issues

people have with Discord.

Do they use Telegram?

Then there's those issues.

Some DAOs like Purple are

trying to have all their

communication on Farcaster,

which is interesting,

but doesn't seem perfect either.

So that's a different challenge, right?

It's like communication...

I think it's related,

so I've definitely got some

ideas on that.

And I think one thing that

we need to consider is that

depending on the DAO,

each DAO will generally

tend to gravitate towards a

particular channel for

communication based on their objective.

So a lot of people

historically love Telegram.

I think there's a new sort

of wave of DAOs who prefer Farcaster.

regardless of what medium

you communicate on,

we have to remember that, again,

a DAO is a broad church.

We have participants who may

not necessarily are

familiar with Discord or

maybe don't want to have Telegram.

So that poses a real design

challenge in terms of where

we allow people to

congregate and also who is

allowed to participate

within certain channels.

So if we

uh just loop back to that

original example where

actually I don't know if we

talked about this here or

if that was in the dow a

town hall before but like

to say for example one of

the things that we

experimented with uh when

it came to transparency and

communications in a dow we

had a discord channel that

was for verified members we

had another channel that

was for delegates where any

of the delegates could

speak so they didn't

It wasn't cluttered with additional noise,

but we also allowed the

verified members to view

that information.

Then we also had another level,

which was for signers who

wanted to specifically or

strictly speak about price sensitive

So I think there are a lot of challenges.

There are definitely some

interesting tools that are

coming out in the next

month or two that will

potentially aid these types

of communications.

There's also technology that

we have to consider.

So again, Discord, centralized.

Telegram, arguably centralized.

And we don't know what's

actually behind the scenes.

So one of the properties

that we need if we want to

do this properly is like, well,

who actually offers intent

encrypted chat that is composable?

And the two- And can be owned by the DAO,

right?

Correct.

And it's sufficiently decentralized.

That's a key point, right?

So yeah,

there's two technologies that I'm

really interested in.

Waku Protocol.

They've been in the space

for a very long time.

They're doing some really

interesting work.

And there's another really

cool protocol called, I believe,

Hole Punch.

And that is super novel.

And I think it's actually

funded by the USDT guys.

And it's built on top of...

DHT technology,

which is the technology

that powers BitTorrent.

So it's generally

decentralized and it's

theoretically unstoppable.

So again, really interesting technologies,

but again, nascent.

Yes, it was good to hear.

I wasn't aware of those projects.

It's good to hear those are coming soon.

I can list another one that's coming soon,

which is called Common.

It's built by the founders of DAO Stack,

which was, as you probably know,

is one of the original DAO

tooling platforms alongside Moloch.

But the DAO Stack team ended

up pivoting and going in a

different direction.

I don't think anyone uses

DAO Stack anymore,

at least not if you're

launching a new DAO.

But the team is now focused

on a collaboration tool for DAOs.

So it's not out yet,

but I think it's coming soon as well.

So that's exciting.

Awesome.

Yeah,

let's put these in the show notes to

definitely get the word out for sure.

Yes.

Yeah, definitely.

Yeah.

Although I wish we could

send people stuff they

could start using today,

but we'll have to look

forward to that coming soon.

What do you feel like is the

future of DAOs in terms of

what you're seeing,

what you're experiencing?

Where are we going to be in

a year and in several years?

Well, let's just take a macro view.

So for me,

I strongly believe that DAOs are

an important and innovation

akin to the

limited liability company.

So when limited liability

companies first came on the scene, uh,

I believe they were originally created.

So when ships went out to sea, um,

and people had to spend a

lot of money to go on these

voyages and come back and, you know, the,

the capital would be sort

of constrained in terms of

how it was lost.

I think that DAOs are

basically the next level up.

And, um, it means that for me, uh,

The more quickly we can

coordinate capital

efficiently and without any

geographical boundaries is

really where DAOs will win.

I don't know how long it

will take for us to get there.

Innovation moves extremely quickly.

So I wouldn't want to sort

of put any time horizon on that.

It could be as early as the

end of the year for all we know.

But I think the main thing

that we want to take away

in terms of the future of

DAOs is just quick capital formation,

accountability, coordination.

Yeah, that's what I'd say about that.

Cool.

Is there anything you think

that's a major blocker we

need to solve for to get there?

um, legals.

Oh yeah.

No, say more.

Well, um, to be honest,

you're probably a better

person to speak on it,

but I think just ensuring

that people have the appropriate, um,

legal protections to

participate in these

innovative structures

without fear of

repercussion is probably

the most important thing.

Yeah, I'm not an expert on the topic,

I would consult a lawyer.

But yeah,

that's probably the biggest

concern I have that is a

hindrance to this.

Cool.

Well,

it's always good to hear since that's

something I'm working on.

Um, I think, you know,

what we see is really maybe

two approaches to that problem.

Uh,

there's the one that we're taking at my

Dow,

which is to create legal forms like

the LLC, uh, you know,

called the Dow LLC or whatever.

It could be the Duna in

Wyoming that's coming out soon, um,

where you're basically, uh,

Some people have been very

critical about it.

They said, hey,

why are you taking

something that was made for

a different situation and

retrofitting it?

I mean,

another way of looking at it is

we're just taking the laws

that were written and

adapting them so they work

for DAOs and Web3.

Makes it sound very plain vanilla.

And so that way any DAO can

register a company and get

all those legal benefits

that people have been

getting for hundreds of years.

I think a different approach,

which is interesting as well,

and actually just this

morning I spoke with a

state representative from

New Hampshire where they're

working on something like the following,

which is

rather than creating a

company forum that people

necessarily need to

register with the state the

way they would a traditional company.

Instead,

maybe we need some basic

protections automatically

written into the law that

automatically apply to DAO

members and give them those

benefits even without any

kind of registered company on the books.

And so for example,

if you could create a set

of characteristics and say, okay,

if you're a token holder of

a sufficiently decentralized

system and here's what

sufficiently decentralized

means and there's maybe no

one with too much power and

everything is really done

on chain and a b c d e f g

whatever the considerations

are then we're going to

actually give that legal

protection to the token

holder to the member

that otherwise you would

have had to register a

company to get that protection.

So it's almost like building

in a default special

treatment in the law for DAOs.

And I'm not sure which one will win.

I mean, on one hand, yes, obviously,

DAOs are different.

DAOs are unique.

Maybe there should be some

different default treatment.

But the fact is that every organization

for the last several decades

and even hundreds of years

is unique and different.

And you give organizations

doing all kinds of different stuff.

But the law has been applied

about the same way.

Like either you don't register a company,

in which case you get this treatment,

or you do register a company,

in which case you get the

treatment afforded to that

company type that you're registering.

So I'm biased because that's

what we're working on.

But I don't see any reason

why that can't be the way things go.

Yeah,

I think the key word there is

sufficient decentralization.

A lot of DAOs will face a

cold start problem with a

few individuals leading it, right?

But I guess the real question is,

how can we demonstrate or

how can they prove that

there is a sufficient

pathway to decentralization

and hold them accountable to that?

And as long as that happens

within whatever timeframes,

I think it's okay.

But if that doesn't happen and, hey,

it's like the five people

who started a DAO and we're

going to keep control for

the next three to five years,

that's an issue.

Yeah, yeah, interesting.

All right,

we're getting close to the end

of the show,

so I want to ask you just an

open-ended question,

a couple open-ended questions,

and I'll share the questions at once,

and then you can share

whatever is on your mind.

Okay.

So the first thing is,

what advice do you have for

people starting DAOs today?

So if someone came up to you

on the street and said, hey,

I'm starting a DAO later,

what's your advice for me?

What would it be?

And then two is relatedly,

if you have any DAOs,

you'd recommend people

check out who are new to the DAO space.

Maybe that could be part of

your advice to this person

on the street is some

examples of cool things to check out.

If you're

just looking to see what

DAOs are like and experience some DAOs.

So what advice and what DAOs

would you recommend that

people check out?

For sure.

Okay,

so I would say the first and most

important thing that anyone

who wants to start a DAO,

develop a clear mission and

a vision first.

Because that really is going

to be the anchor that you

can always refer to in the community.

And in times of turmoil and trouble,

it's something that you can just be like,

hey, guys,

this is what we're aiming towards.

Let's make sure that we get on track.

The second thing would be

transparency in terms of

spending the funds.

Let's keep in mind that this

is consumer retail capital,

and it's really important

to be respectful of

how and where that money is being spent.

And as long as you can sort

of demonstrate that,

I think people are

generally okay with where

the money will go.

The third thing would be

open to feedback and criticism.

I think there's a lot of egos and doubts,

but if you can demonstrate

that you are open to

feedback and that feedback

is incorporated into the

governance structure,

I think people will

appreciate that for sure.

So the top three takes, I guess,

for starting a DAO.

Let me think.

In terms of tools or people

being into DAOs, I think, again, Snapshot,

great tool.

It's such a multipurpose thing,

very easy to use,

doesn't require a lot of

technical knowledge,

and you can just get

bootstrapped pretty quickly.

I think I've even seen a

soccer team run who's on rotation.

you know in their sort of

like little um weekly games

run on snapshot so it's

it's pretty fun it's pretty

interesting I really like

um joke race which is

another on-chain um tool I

think um there are some

pretty interesting

experiments happening with

that at the moment so

purple dow um they are

currently holding their

council elections on it.

So I would recommend checking that out.

Um,

and I guess from an academic point of

view, um,

I would recommend people look

into meta governance, meta gov.

Um, they are a great organization, um,

who really specialize in

some of the more esoteric

thinking around DAOs.

And, um, yeah,

I guess a couple more things let's think,

um,

Yeah, and DAO Theory, Green Pill podcast,

Kevin Iwerke, I think is amazing.

So that will give you sort

of a green take on how DAOs

can provide specifically social impact.

And one that is, I guess,

a little bit more creative

and not so serious,

I would recommend checking out HyperSub.

So HyperSub is...

again really interesting not

a dow but it is um

basically people with

subscriptions and they're

typically artists or

creators and communities

form around them and

they're really really

interesting and are they a

doubt or are they not they

are definitely a group of

people coordinating around

a goal so yeah those are

the things I would recommend

Interesting.

Yeah, those are great recommendations.

Yeah, that's a good point.

Is every newsletter and its

followers a DAO in some way?

At least once you start

putting things on chain.

I mean,

like a sub stack with 7,000 or

30,000 users, that's a community, right?

Yeah, at least a community.

Yeah.

And then it's just where do

you cross the line and go

from being a community to being a DAO?

And maybe as soon as money is involved.

I mean, I think for a lot of communities,

once there's a treasury or

a need for a treasury or an

opportunity for a treasury,

I think then you usually say, okay,

we got to just introduce a

little bit of structure

here and do it as a DAO.

Yeah,

I think it's a really great point to

end on.

Yeah.

Cool.

All right.

Well, Arnold, this has been awesome.

Before we close,

where can people find you

and Lighthouse and or

anything else you'd like to

share on the web and on social?

Yeah, you can go to lighthouse.cx,

and we have an Android and iOS app,

so we've coded for everyone.

They have a feature parody,

so we haven't forgotten about you.

And my handle on Warpcast is 1A35E1,

which is the hexadecimal code for blue.

I wanted to be anonymous at one point,

but then that got thrown out the window.

So yeah, that's the reason.

That's why I always called

Arnold Blue until about

today because of his nickname there.

Awesome.

Well,

please go look up Lighthouse and look

up Arnold.

Find me on Farcaster as well

at The Thriller or I'm

ZeroXThriller on X. And

MyDAO is MyDAODS on Twitter

for MyDAO Directory

Services and MyDAO.org, M-I-D-A-O.org.

Again,

a quick ad before we close for MyDAO.

MyDAO, my company,

provides legal entity

solutions for DAOs and Web3.

If you're thinking about

legal entity solution for your project,

please reach out.

We also have a network of

lawyers and other

professional service

providers all over the

world who can help you with

tax advice and other

professional advice related

to your web3 project if you

are a lawyer please reach

out or another professional

service provider please

reach out about being added

to our network again arnold

thank you so much for

coming on the show thank

you so much for having me adam cheers

You got it.

Cheers.

Quick disclaimer,

none of this is ever legal

advice or tax advice or

financial advice or any

kind of professional advice.

And finally, to the audience,

are you thinking about starting a DAO?

Just DAO it.