Panel discussion: Deep diving into DAOs

Welcome. Welcome. Let's talk about DAOs. Cool. So I'm joined today by Kazi and Shogo.

We originally had a third panelist, but probably not really today. So if he shows up or if Frisco hears this, please come on stage anytime. Okay, so for the next 30 minutes, I just want to kind of briefly touch on the nature of DAOs and what are some interesting opportunities in DAOs and what your both observations have been in kind of being embedded and working in this space and particularly kind of exploring the concept of DAO. So Kazi was an organizer and creator of the AI and DAOathon, which is a hackathon for DAOs, also has a background in as a contributor in bankless DAO and Shogo is a developer focused on smart contracts. And yeah, so I want to kind of just jump off and start with a basic question because DAOs are something that's fairly vague to me, even after seven years of working in this space.

So what do you think, what would you say, maybe let's start with you, Kazi, what's a DAO from your point of view? Like how would you define it? And maybe also like what makes you interested in DAOs in general? Yeah, thanks so much. I think the DAOs for me is to the on-chain community in general, I think.

For the example is, traditionally we have a community and then collaborate together in some kind of purposes and something like that. But as you said, as you guys seeing such like that, the on-chain is coming, right? So it's going to be more like governed by on-chain itself. Although the people from the bankers, there are a bunch of various definitions about DAOs right now. For example, in the bankless DAO, there are people like the chat room with treasuries or something like that.

But yeah, in general, the DAO itself is on-chain, which means the importance of preserving their logs and histories for good, I think. The remaining kind of activities for good. I think that's a much more unique point of the on-chain communities, so-called DAOs, I think. Cool, nice. And what makes you excited about DAOs?

How did you get into the space? What made you interested in actually working on the details details uh yeah uh i think that one of the interesting point is to not create just a community but creating some on-chain like a project or business or some in all aspects of the ways i think the you know in general the traditional startup is need to be uh funding so you need to be like gathering some people there some people, and generate a new idea. But even, mostly it's kind of ways is rely on the founders or the same person, that single person. But I think that was these collaborative ways initially. That's why the new ways of a startup program or project is one of the unique aspects of the wait.

And I think from my Bankless DAO experiences, a collaborative, two years active, inactive as a Bankless Japan, I think one of the most important and interesting things for me is kind of like that. Nice. Thank you. And Shogo, what's your excitement about DAOs? And what would be your definition?

How would you explain what a DAO is to someone who's non-technical? Non-technical. I want to ask one question to the old DAO dude, Kazuma. Let's say there's slight nuance in DAOs. say there's slight nuance in DAOs.

If Discord has some payment service and if Discord has some DocuSign-ish contract service, is there a strong community? Is that Discord is DAO or not? I think it's kind of a DAO-ish community, I think. The important thing of DAO is, for me, is to preserving the activities in an on-chain, I think. So even the payment and running by Discord is kind of like a DAO-ish community.

Although in the broader meaning, I think this kind of DAO-ish community, which isn't running by on-chain, will be also defended by DAOs for the light players, like people who are new to joining our L3 with DAOspace, that would be great. But initially, I think one of the most unique points of DAO is preserving or running in on-chain, I think. All right. So next question. Yeah.

It's very weird to ask a question from me to you. But how do you think about Bitcoin? Bitcoin doesn't have treasury. It doesn't have any voting. How do you think?

Is Bitcoin a DAO or not? I think Bitcoin is a DAO, I think, personally, because everyone is running without nudging the other part. Initially, they are driven by the internal DJI or something like that. And also Bitcoin is running by kind of fully on-chain. I think that proof-of-work or proof-of-sake or whatever is like activities for kind of Bitcoin DAOs, I think.

That's why personally I think that Bitcoin is pure DAOs for me. Sorry, I come up with the third question, which is like, the onion looter is also looks like DAO because they are requiring bandwidth as a resource. And that resource is shared to the users and not bandwidth providing users cannot take any better bandwidth from network. Such kind of incentive system, there is no money incentive anyway. How do you think about that?

It's a pure P2P system, but how is DAO? That's an important question, an interesting one. Because, yeah, some of the DAOs is not driven by the monetary incentive, I think. Yeah, that's quite true, especially for the local governance area, or literally adopted by the product ways or the solution of local issues, like declining populations or preserving the customs or something kind of like that. And yeah, of course course they don't have any treasuries right now but as the things going on the people who are adapted to the kind of product or treasuries of course it is prepared for the kind of local, it depends on the situations, but they're gradually, I think, adopted a kind of wallet, I think.

So, also, I have a question for Ochai-san, that what kind of product or technical status or stacks or characters should they or the builders need to kind of building their pure DAOs and what is DAO for you? So from my point of view, let's go back to the definition of smart contract, which is for me, smart contract is the mono-direction contract. So in legal terms, there is a bi-direction contract, you know, it's Ar Alice and Bob contract, but the smart contract is the contract with the world. Alice with the world contracts. It's like a synchronous contract to the inline.

We can share the kind of temporal contract to the inline and everyone can take it. This is a smart contract and no other technology can do it. This is a core technology and my definition of DAO must utilize this monodirectional contract feature. Then by using that, if there is treasury and a boarding, it's DAO. If that is using something like a donation and a later active public goods funding issue, sorry, it's technical, but something like a volunteer-based, later we will reward them, that kind of mechanism if there is.

The later rewarding is also boarding, that kind of mechanism is there is. The later rewarding is also voting, and the donation is the treasury. So I regard this as a DAO. Yeah, that makes sense. The DAO, the definition of DAOs has initially needed the treasury, so they're kind of like that.

Yeah, totally, probably I agree with that. Then I think the most DAOs are utilizing their tokens as voting ways. I think in that sense that they have, initially have the treasuries and then they issue the token as a voting power. But in a certain kind of cases, which is China may build their kind of a decentralized community, the founders call it DAOs, but it depends on the definition, I think. So how the possibility to have DAOs without treasuries, I mean the voting function, only for voting function or only for listing activities for good.

Is that kind of possible or what do you think? That motif is very reasonable to Bitcoin thingy. And still Bitcoin should have treasury because newly issued Bitcoin is the treasury actually, right? So think about that. There is no stablecoin or Ethereum-based treasury, but newly issued token will be there.

That kind of structure is also a treasury. Then think about Curve Finance. Do you know anyone who reads any kind of Viper contract of the Curve Finance? There's CurveDAO. Sorry, it's technical.

But the CurveDAial smart contract is very interesting because it's not only an automatic market maker, it also has a DAO feature inside of it. It's a gauge controller. That gauge controller accepts some liquidity-providing token, and that token deposit and VECRV token amount is going to be the kind of decision making power to decide which lp pair must be boosted this is the future future lp reward is going to be the treasury but it's still down so this kind of very slight nuanced bagel dows lecture always there is and what i don't like for the DAO community now is the existing typical DAO is only DAO. Everyone is thinking, but DAO is quite flex, and we can make any kind of DAO, right? So everyone must like solidity or something.

Oh, that's an interesting point. What do you think for Andre? Is that kind of, what is the things necessary for DAOs? Or do you have any example? What do you think?

What are for Andre, what is the things necessary for DAOs or do you have any example? What do you think? What are some, what for DAOs? For DAOs in general, and DAOs are initially needed, requires to have the treasuries, and they have the voting powers for the participants. It kind of on-chain activities, so there are a lot of functions or parts that consist of DAOs, but it really varies from the definition or necessity of the DAOs.

So what do you think is the most working DAOs, or what do you think about that, with perspective? I guess I'm thinking about DAOs more like as a technological evolution of what's been around for a very long time. So like if you think about how humans organize around anything, humans love doing stuff and humans love doing stuff that makes sense. And there are ways of like coordinating a smaller group of people around some little goal. There are systems for organizing hundreds of people around a common goal.

And I think that DAOs are essentially just a way of automating a lot of the processes that are inefficient with traditional organizations, corporations that rely mostly on pen and paper. So I would just look at what already exists and has been around for like hundreds and thousands of years, which is kind of both. So there's like volunteering organizations and people kind of making decisions, group decisions together to make impactful projects that are, you know, pro bono or, you know, volunteering based because people care about their reputation because people care about like reputation, because people care about learning more. And there's also things that are like businesses, like things that are really replicable and high quality at a consistent basis, especially when you need to kind of visualize the value in quantitative terms. That's a business and that's a bank account.

That's a business and that's a bank account. That's the treasury. And there are shares, there are voting rights. The voting rights are due to efficiencies constraints, usually mostly distributed among the shareholders. And it's rare to see that a business goes through the administrative burden of giving every single individual who's contributing to our organization adequate voting rights.

It's just complicated. So DAOs are actually a good solution to make that more fair. And then it really depends on the system that we want to build as a community. So it's very, very custom and individual. Yeah, that's an interesting point.

Yeah. I was so curious about that. Dow is for business, you said, right? It's kind of, maybe make use of the business, right? I think that mostly the Dow's example is more like of course research ways or like a local adoption of the solutions or the DeFi or Bitcoin initially on-chain.

But what about the business? I think that maybe your business is kind of like the traditional business to like sell some stuff or, you know, business in general. Merchandise in general, I think. But what do you do? Can you you elaborate what a business DAO is?

What a business DAO would look like? Yeah, kind of like. It's the same like a very real example. It's like almost no one talks about it kind of like that. Right.

I mean, I think the cool thing that's possible with DAOs, in particular for small businesses or even larger businesses, is the ability to coordinate a lot of people without knowing them personally, paying them in a work contingent way so that you actually pay them for the work that's being done, and that you're able to steer the organization in a much more precise manner. and that you're able to steer the organization in a much more precise manner. So, like, as opposed to having long-term contracts, which kind of don't really say what the value of the work is, within a DAO you can much more precisely, if you do the adequate documentation of work, much more precisely allocate resources towards the things that really matter and gather people's opinion around what direction they want to take as a whole community. Again, because it's much easier to distribute tokens than to have accountants and legal departments signing off like your agreement of being part of the organization and receiving some equity and that's the voting right. And like, how is that adequate relative to your contribution?

It's like all of that is like super complicated in like pen and paper terms, but becomes a bit easier if you use like more automated processes. So I think, I mean, that's just how I would say that it works. And it's like running a business is usually very expensive, but with DAOs, you don't need any of the expensive stuff. So you basically, if you understand what an online community is, then you can run a business with the tools that we have in the Web3 ecosystem. What's your take on that, with regard to tooling?

What have you seen? What works? Or what are you kind of, I guess, what would make sense for you in that realm? Now for what purpose? Yeah, for like, yeah.

So yeah, this is my kind of preferable topic. Local community, of course, you know. I've been researching Prisma since like eight years ago. And finally, I noticed that the low-up is going to be kind of penetrated use case. And now it's with the ocean market, right?

Low-up is. And I said, we have to put something good application on it. And I said that nation states is going to be a good use case for DAO and a smart contract, because the treasury is quite huge for nation states. But I noticed that we have to make it more smaller to actually practically implement such kind of real world autonomy DAOs. So I made the techist DAO, which is now already open source, and it will be front-end as well.

It will be open source, the Techist DAO will be, which is based on the meta-contract framework of Solidity. The Techist DAO is the Techist Management DAO. Can you imagine that the Google Docs and Notion are centralized? And you're living in an apartment, you purchase that apartment, and you have to collaborate with other residents to make that apartment more valuable. And you have to maintain the value.

But one malicious guy maliciously updated the Notion rules. That is lame, right? So the trustless text management for DAO is quite important for the autonomy DAO, and I made it, and I open sourced it. Text DAO. And that is a kind of groundwork for the DAO for local community.

I'm doing that. Yeah, I like that. How have you seen that work so far? Or like, do you, have you, have you seen any examples in the real world where that's the case or have you tried to kind of play around with it? So I'm now working with Nikken Seikei Corporation, which is the corporation who built Tokyo Skytree, you know, and that corporation is eagerly looking for opportunity to apply DAO to the real world community.

Like, their budget size is something like 10 billion yen per project, you know, because one city design, it's quite a huge budget. because one city design it's quite huge budget and as I want to put down on it because you know in Tokyo there was Kunitachi there is Kunitachi city and there is Fujimi Dori it's street which can see the Mount Fuji and Sekisei house built apartment there that apartment conceded the scenario of Fuji. And residents just get mad and try to deconstruct that apartment. Finally, it actually has agreed to deconstruct it. So this is a huge risk for building something in Tokyo, right?

So actually, downfall deliberation is a hedge for such risk. That's why they are quite eagerly researching on it. So yeah, I'm now doing that project. That's awesome. Wow, cool.

Or do you want to add something? Yeah, of course. Another example I know is the adoption for the local shrine, I think. It's not yet to be projected right now. But you know, the it's a shrine, which is one of the most sacred place, sacred shrine in Japan that has 2,600 years history.

But, you know, the sacred ritual thing is, because of the declining population, the sacred ritual can't be sustainable or prolonged for the next hundred years. So the people are trying to make KP sustainable by using DAOs, by onboarding extra money and extra people to get involved into the kind of ritual customs. to get involved into the kind of ritual customs. That's why they kind of, they are seeking for the ways to keep these kind of customs sustainable, and they are like a principle and a notion is to keep sustainable, with keep sustainable and prolong without changing anything. It's kind of similar principle as Ethereum nurturing infinite garden, I think.

To keep sustainable itself is a purpose. It's like a kind of similar ways as Japanese, you know, the spiritual stuff and then one of the good example is the Shrine. And then DAOs should be... DAOs have maybe one of the greatest solution for that. Do you think it could have an impact, and if so, how do you think that might look, the impact on kind of the population decline in Japan?

Yeah, the population, it's kinda, I think a huge impact by using DAOs. And because initially the declining population makes all of the customs or traditional things maybe extinct because of the declining population, the lack of the successors. That's why initially the impact is quite large. But the important problem is that almost no one who is well known about this problem doesn't write a quote, doesn't know the text, anything. That's a much more chasm or important thing to get more and more people, local and rural people, can be onboarding to build DAOs or DAO stuff, even though it's not so much strictly defined as DAOs.

But it's more like the important thing is to solve the real world issues. What are some basic things, and maybe this is also a question to both of you, that you would say are the fundamental first steps or maybe principles for starting a DAO. So like if you wanted to explain that to the local municipalities or communities, what do you think they should do? What do you think they should know if they're curious but very, very new to the space? Well, I live in Saga Prefecture, which is quite rural area in Japan and there's many house owner associations and it has treasury in bank account.

That's the yen. You know it's quite risky because weak yen is still ongoing you know. There is no other way to have other currency in House Owners Association in such autonomy. So let's say, just saying, you can have your House Owners Association money with dollar, with yield farming 4%. That's all.

Nice. I like that. Yeah, that's very basic. And I mean, it's kind of like, hey, welcome to treasure management. kind of like, hey, welcome to treasure management, and you have now an open world of different currencies and explore how you can grow your treasury with very little effort.

Do you have any thoughts? I think that one of the important things is not explaining jargon or the specific term with not using anything. The initial notion of DAO, or ways of collaborative together, is initially inherited by the people who are living in local places. That's why people easily understand the ways of thinking of DAOs initially. But when it comes to talking about the technical stuff, like DAO is decentralized or blah, blah, blah, it's suddenly confusing, right?

And that's very obvious but quite important things. I think that because of a basis is important. That's why we should be more broad in the ways of thinking, collaborative ways, on-chain, without using the term of ways of the Web3 stuff. Yeah, nice, very cool. We are at time?

Time's up, okay, cool. Well, thank you so much, guys. That was fun. Thank you so much. Thanks so much for you all, and I'll pass on to the next people.

It was a great session.