Decentralized Collaborative Organization

Description

Jordan Greenhall:

"In a tribe, constant close communication and large group consensus-building enables the organization to stay on the same page, make decisions, allocate resources, choose objectives, etc. In a hierarachy, these governance functions are satisfied through the entire toolbox of meetings, briefings, power points, strategy documents and compensation schemes that are the stable of corporate life.

So far in the evolution of DAOs, these functions have been largely a mix of a tribal model at the center and a hard-wired incentive structure (like mining) for everyone else. But for the DAO model to scale, some new much more robust and flexible approach will need to be constructed.

And right now, in much the same way that Ethereum has generalized the blockchain, efforts are underway, notably at Backfeed.cc, to generalize a game theoretic protocol for motivating and aligning interests." (https://medium.com/deep-code/the-future-of-organization-b26219e5fc95#.g3j5cgjk3)

Characteristics

Jordan Greenhall;

"Such a protocol should satisfy a few basic requirements:

==Distributed governance== 

— There should be no centralized evaluation and reward distribution. The protocol should be able to operate in a decentralized peer-to-peer network, in a way that ensures accountability and auditability.

==Scalability== 

— The protocol should support the operations of a variety of decentralized collaborations, regardless of their nature, objectives, and size. The protocol must enable scale-free organizations that can grow from a handful of individuals to hundreds, thousands, or millions of people, and if needed, also shrink back to any desirable size with no adverse effects.

==Resilience== 

— The protocol should sustain any potential operational failure, fraudulent activities, or malicious attack.

==Incentive for beneficial collaboration== 

— The protocol should provide agents with incentives to contribute to the DCO. The protocol motivates participation by ensuring that agents will be rewarded with “tokens” as well as with a reputation score according to the community’s evaluation of their respective contributions. The protocol also motivates agents to evaluate genuinely each other’s contributions by ensuring that agents reputation in the DCO will be adjusted, upward or downward, according to the quality of their respective evaluations.

==Internal alignment== 

— The protocol should promote the alignment of agents within the DCO. The reputation scoring mechanism must be designed to enhance the reputation (and thus the impact) of agents that further the interests of the community. By adjusting the reputation according to the quality of evaluations, the agents whose evaluations are the most aligned with the community’s values acquire a stronger level of influence within the DCO’s evaluation system.

==Diversification== 

— In addition to encouraging the internal alignment of agents within a DCO, the protocol should also encourage diversification at the external level, by facilitating the exploration of alternatives features (e.g. spin-offs or ‘forks’), which might prove to be the most suitable to a particular context.

Delivering on this set of requirements will be no mean feat, but judging from the current amount of attention and energy that is being focused on this problem space it is clearly the new frontier in the movement to Decentralize Everything. And while it will likely be a decade before these new models of human organization are fully developed, if they can combine the equity and innovation of tribes with the scalability of hierarchies, there is every reason on the world to believe that they represent the future of how things are done in our emerging new civilization." (https://medium.com/deep-code/the-future-of-organization-b26219e5fc95#.g3j5cgjk3)

Examples

Bitcoin

Jordan Greenhall:

"Imagine the Facebook network without Facebook. People lending or borrowing money, buying and selling goods or services without relying on banks or Paypal, insuring each other with no centralized insurance companies. Imagine a decentralized transportation network independent of Lyft or Uber, renting apartments without AirBnB, new P2P marketplaces emerging instead of eBay or Amazon. Imagine the ability to replace every service with a decentralized counterpart that does not rely on any trusted party or intermediary and provides no purchase for greedy or corrupt middlemen.

This vision is beginning to unfold. The Bitcoin monetary network is the first truely decentralized organization that managed to scale and enter into the mainstream. Now worth over $3 Bn, Bitcoin is used by millions of people worldwide, and more corporations and governments are starting to acknowledge its value every week. And it has done all of this without the use of any centralized hierarchy.

The core breakthroughs of Bitcoin are:

• Its underlying technology, the “blockchain” — a decentralized public ledger that enables anyone to provably exchange value with anyone else, but that cannot be controlled (or corrupted) by anyone; and

• Its game-theoretic model for motivating and aligning interests, “mining” — an incentivization mechanism that attracted the resources and activities necessary to build, mature and maintain the network without any central decision-makers.

Bitcoin has been an extraordinary proof of concept. But because its innovations were “hard wired” to provide only the limited functionality of a “currency network”, efforts have been underway to generalize these core innovations and unlock the potential of truly “decentralized collaborative organizations”." (https://medium.com/deep-code/the-future-of-organization-b26219e5fc95#.g3j5cgjk3)

Ethereum and the Blockchain

Jordan Greenhall;

"The initial implementation of the blockchain in Bitcoin was a “public ledger” — a dynamical distributed database that is held by all the nodes of the network, all of whom simultaneously authenticate its changes and updates and verify them against a predefined “set of rules,” hardcoded into each node’s client app.

The state-of-the art of the blockchain today, built by Ethereum, is much more than that. It takes the blockchain beyond a decentralized database, to enable decentralized execution. In effect, it is a public computer which is literally being run by the commons, for the commons.

The result is that this blockchain can provide decentralized evolutions with any set of rules, and these programs are not required to be hard coded into each nodes client, but rather can update themselves via the mesh network, as a sub-layer of the decentralized database itself. These programs are often called “smart contracts”, or “smart programs”, and are written in a Turing complete script language, meaning that they enable the the use of the blockchain technology for an unlimited number of human goals.

Ethereum and similar efforts provide one half of the fundamental infrastructure necessary to enable the widespread emergence of decentralized collaborative organizations at scale." (https://medium.com/deep-code/the-future-of-organization-b26219e5fc95#.g3j5cgjk3)

More Information

The DCO can be compared to the earlier models of:

• The Tribe

• The Hierarchy