What the media miss about decentralized autonomous organizations

The New York Times: “Reality invades a utopian crypto vision.” Bloomberg: “The next crypto bust could be spelled DAO.” The Guardian: “Are blockchain-based DAOs really a utopian revolution in the making?”

Seemingly every week, another old-fashioned media outlet echoes the talking points of defenders of the status quo financial system who fear and mistrust the economic opportunities that will be unlocked by the power of decentralized autonomous organizations (DAOs). While publications rightly acknowledge the unsurprising early growing pains of DAOs, this sort of hand-wringing misses the woods when it comes to DAO’s impact.

Rather than simply being a “utopian” experiment, DAOs are a critical tool in developing a new decentralized financial (DeFi) system that has the potential to reach the 1.7 billion people worldwide who currently lack access to the traditional financial system. DeFi promises to give individuals everywhere access to a reliable and transparent financial system with clear traffic rules.

The Potential of DAOs

Furthermore, while we have only scratched the surface of the potential DAOs that need to create a radically more transparent and equitable financial system, we have already seen projects emerge that deliver real value to real people in today’s real world.

One example is the war in Ukraine, where UkraineDAO, founded by Russian art collective Pussy Riot and Trippy Labs, raised more than $6.75 million worth of Ether (ETH), donated directly to Ukrainian defense efforts against Russia. While this amount may not shift the balance in the war, UkraineDAO’s rapid establishment and scale-up demonstrates the power of decentralized financial technologies to coordinate a disparate global group of individuals around a single goal to deliver tangible results.

Related: Every Bitcoin Helps: Crypto-fueled Emergency Aid for Ukraine

But the value of DAOs goes beyond simply raising money for noble causes under duress. In fact, many DAOs are already providing sustainable value to participants around the world, even leveraging blockchain technology to address some of the most pressing challenges of our time, such as climate change.

DAOs are used today to support charitable activities, remove barriers to crowd-sourced fundraising, give donors greater control over how funds are spent, facilitate low-cost loans, and support artists and musicians. All of this is designed to be managed by transparent smart contracts that give users control over the direction and governance of the organization.

Other DAOs are using new technologies to directly address human-induced climate change. KlimaDAO, a subDAO of Olympus DAO, to which I contribute, has devised an innovative mechanism to take carbon credits out of the voluntary carbon market and into the DAO’s coffers, effectively driving up the cost of carbon offsets and making it more expensive to hire carbon-intensive companies. to build.

Related: The pandemic year ends with a tokenized carbon cap-and-trade solution

KlimaDAO already has locked more than 17 million tons of tokenized carbon credits, exceeding Croatia’s annual CO2 emissions. Projects like this update the promise of DeFi technology and develop a new way of doing climate activism that puts environmental concerns into the fabric of economic activity.

As with any revolutionary new technology, DAOs open up limitless opportunities for innovators to solve problems in new ways, but have also captured the attention of scammers looking for quick cash. Scams like carpet pulls, where a developer goes into hiding with money invested in a project, are real problems in the DeFi ecosystem that need to be addressed. We are committed to strengthening the legal requirements that ensure DAOs are safe to protect consumers.

Related: How to Draw a Carpet in DeFi: 6 Tips from Coin-Crypto

But we can’t let a few bad actors distract from the truth that DAOs and the entire DeFi ecosystem are causing a much-needed disruption to traditional financial systems that have been predatory and exclusive to our most vulnerable populations and harm our planet. It’s time for mainstream media to look under the hood at DAOs and come forward with a truer and more nuanced picture, reflecting what those of us involved with DeFi know: that the efforts we lead today will drive the future. generations will bear fruit.

This article does not contain investment advice or recommendations. Every investment and trading move carries risks, and readers should do their own research when making a decision.

The views, thoughts and opinions expressed herein are those of the author only and do not necessarily reflect or represent the views and opinions of Coin-Crypto.

Isfandiyar Shaheen is the founder and CEO of Wagmi Labi Inc. Previously, Asfi led private equity firm Cyan Capital, served on the board of public companies for Engro Corporation and Engro Foods, helped establish the mobile tower sharing company, Towershare, acquired by edotco Group in 2017, and co- created a plan to deploy fiber to power lines as an Entrepreneur in Residence at Facebook Inc.

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