New section on the governance of virtual communities, peer production communities but especially blockchain-type collaborations.

Quotes

"Within blockchain-based governance mechanisms, standard token voting practices rely on the neoliberal notion of “voting with your dollar.” Like the capitalist market, this means wealthy investors can simply purchase large amounts of tokens on the market in order to hoard voting power. This system allows these capitalist robber barons, or “whales” to greatly influence the outcome of proposals submitted on “decentralized” applications. In other words, financial power becomes directly correlated with political power."

- Breadchain [1]

"Prevalent among communities forming around blockchain technology more specifically is an emphasis on relegating governance to automated enforcement by a protocol, coordinating the otherwise free actions of actors in the network. More than a technology, blockchain has come to represent a powerful narrative and governance ideology (Reijers and Coeckelbergh, 2016), promising the possibility of automating governance, understood as the coordination of individual actions at aggregate scales. This idea has manifested in different approaches to governance in blockchain communities, which we discuss in part one of this article as materialist, designer, and emergent ideas, and approaches to governance relating these to three evolutions of governance theory (Mayntz 2003). Blockchain is a particularly fruitful context for discussing dissensus as it is navigated by online communities because, as an ideology, it so explicitly seeks to achieve consensus through technological arrangements."

- Kate Beecroft et al. [2]

"When we look at current “grafting” proposals like the Fei Protocol and Rari Capital merger, or the xDai and Gnosis merger, what we’re seeing is two organisms coming together as one, rather than corporate shells consuming each other as with traditional mergers. These are communities that are integrating, not employees changing offices and titles. We are much more than employees in a DAO: we are owners, voters, curators, ambassadors, and pathfinders. Our language should accommodate these characteristics, and the comparisons to ecology and horticulture are far too apt to ignore. .. This shows us that building and improving the tools and platforms for DAO communities to work together will have immense impact, and will produce powerful interactions that transcend industries and unite competitors. When these communities can easily and trustlessly collaborate, coordinate, and negotiate, they will no longer view project-specific problems as ones to be solved in isolation, but ones to be tackled together. This shift in perspective is essential for a thriving DAO ecosystem."

- Numa Oliveira et al. [3]

"Voting happens all the time in crypto. Participants in decentralized autonomous organizations (DAOs) vote on software updates, treasury allocations, and pizza toppings according to rules encoded on a blockchain. They tend not to vote for politicians to represent them; they vote on proposals, or they delegate their votes to other users in a “liquid” system, enabling them to withdraw the delegation at any time. Power over group decisions doesn’t come from party platforms and political contributions; it may come from metrics of participation in the group’s project, or from the duration of one’s conviction, or the intensity of it. Before anyone votes, a prediction market might highlight which proposals are worth considering. The possibilities of voting are becoming so exhausted in crypto, voting is already going out of vogue."

- Nathan Schneider [4]

Web3 as Prefigurative Self-Infrastructuring

"Web3 is a collective exploration in ‘self-infrastructuring’. The verb ‘to infrastructure’ denotes the activities, processes of integrated materials, tools, methods and practices that make up and change an infrastructure (Star and Bowker, 2010). Thus, infrastructuring is an ongoing process of doing, and these processes are incremental, iterative, and long-term (Karasti et al., 2010). Web3 originates from anti-establishment ideals, and aims to provide the prefigurative means to build new structures for decentralized, self-governance from within the prevailing power structures of society."

- Kelsie Nabben [5]

How the Resistance to Crypto Created More Innovation

"As crypto has developed, there have also been waves of resistance. In the 1990s, with the advent of PGP, the US government freaked out and reclassified cryptography as munitions. They literally said that encryption was armaments, and it became illegal to export from America without a licence under what was called the ITAR [International Traffic in Arms Regulations] regulations. ITAR drove a huge number of cryptographers out of America and a lot of those folks wound up in a place called Anguilla and formed an early crypto island community there. That’s also where you began to see the hybridisation of offshore finance in cryptography, and some people would suggest that that was where you got the birth of some of the stuff that became crypto economics that we started in the late 1990s.

One of these waves of resistance led to the fall of E-gold in 2005. E-gold was a perfectly reasonable gold-backed digital currency system: fully centralised, no real use of crypto, it was a very successful platform. You could transfer $100,000 from one cell phone to another cell phone in the late 1990s for 50 cents, instantaneously, and that was all gold-backed, it was essentially gold-backed stablecoins. That system was effectively shut down in 2005, when the FBI raided its offices over E-gold’s use in criminal activities and confiscated its equipment and files. I would say that almost everybody thinks that the fall of E-gold was the thing that triggered Bitcoin. It was a case of if there was going to be another E-gold and it was not going to get shut down by the government, then it was going to have to be decentralised. The response from the crypto community to E-gold, was Bitcoin and the blockchain, and that led to what we now know as the whole cryptocurrency space."

- Vinay Gupta [6]

DAO's as Seeds of Distributed Social Governance in a Viscous Society

1.

"Seeing the global society in terms of strict dichotomy of “disorder versus structure/control” is counter-productive for understanding and governing it. Both ends of this dichotomy are undesirable: disorder is simply not a viable solution for society, while stable structures are not sustainable and even harmful due to the increasing social complexity. We therefore propose to approach society in terms of a fine balance of ever adapting temporary structures in otherwise fluid whole — a 'viscous' system." ... "What we propose with the image of A World of Views and the Living Cognitive Society is the shift of emphasis from the structures and institutions to the very process of creation, adaptation and dissolution of social subsystems at all scales of the global society. Furthermore, the naturally distributed nature of the process – meaning the absence of central body or ‘trusted party’ governing it – should be embraced, rather than fought with establishing global institutions or ‘world governments’ as, we maintain, no stable structure would be able to outweigh the factors of social complexity driving the society towards increasing fluidity."

- Viktoras Veitas and David Weinbaum [7]

2.

"Although many DAOs would not embrace the label of digital cooperative, one could say DAOs embrace cooperativism as a protocol, meaning an evolving set of relational practices that are distinct from traditional corporate structures or decentralized autonomous corporations, because they prioritize member ownership. The label cooperative can be qualified by digital because today DAOs act primarily to coordinate around digital assets. However, as the concept of DAOs evolves in practice, its digital primacy will fade. DAOs, as we will see, also introduce new dimensions that exceed what the operating principles of a digital cooperative notionally encompass."

- Kei [8]

On the Necessity of Crypto Law

"Disputes arise in blockchain governance. We follow protocols for managing them. Ergo, crypto law exists. The purpose of this writing is to 1) document some of today’s crypto law, to 2) agitate for a change in crypto law; to convince the cryptocurrency community to abandon a crypto law (a law that I’m calling “Szabo’s law”), and 3) to agitate for the inception of a new crypto legal system."

- Vlad Zamfir [9]

Status

WE ARE NOT THERE YET, shows Rebbeca Grace Rachmany:

"The promise of DAOs has been to create more advanced decision-making systems. Yet, to date, the DAO technology has provided little more than voting and funds allocation mechanisms. To govern at a global level has become an imperative in the pandemic, which affects all human beings on earth. Managing this crisis and those to come requires the development of technologies that cover all aspects of discussion, collaboration, proposal-making and accountability."

(https://www.coindesk.com/tech/2020/09/21/daos-will-never-govern-the-world-at-this-pace/)

Typology

of governance mechanisms:

• Consensus Algorithm
• Voting in Blockchain Communities
• Staking in Blockchain Communities
• Forking in Blockchain Communities
• Dissensus Protocols

History

"One account of the prehistory of DAOs could begin with the Rule of Saint Benedict: “a book of precepts 
written for monks living communally under the authority of an abbot.” Written in 516 AD, the Rule of Saint 
Benedict acted as a social protocol that spawned a decentralized network of autonomous monasteries."

This and more in the article:

• A Prehistory of DAOs: Cooperatives, gaming guilds, and the networks to come. By Kei Kreutle. Gnosis Guild,2021

URL = https://gnosisguild.mirror.xyz/t4F5rItMw4-mlpLZf5JQhElbDfQ2JRVKAzEpanyxW1Q

Key Resources

Key Articles

• Limitations of Cryptoeconomic Governance Mechanisms. By Nathan Schneider.