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> Voting, and dividend distribution today requires intermediaries (e.g. broker). Those can be direct. Issuing dividends in a cryptocurrency would disintermedia

> Voting, and dividend distribution today requires intermediaries (e.g. broker). Those can be direct. Issuing dividends in a cryptocurrency would disintermediate brokers and doesn’t require a DAO. Nor does “let’s upgrade our voting systems” require a DAO.

chrisco255 5y ago
It does require a DAO. You need to know that no one party has control over the funds. Or they can screw the community. If the community is distributed the token in a fair way (and they'll know, since this is all blockchain and it's all visible), they can also inspect the code that protects the funds from being spent. So you can encode the mechanisms that protect the disbursements, and you can do this in a provable way. It's not some SQL database that's controlled by an admin key. It's not a bank account that the CEO has control over. All the funds are on-chain, in a smart contract, protected by code and cryptography. That aligns incentives in a powerful way that you can't replicate with stock ownership. You can't replicate it with a voting button on the Robinhood app. It is a fundamental shift in capital management and human coordination.
- atweiden 5y ago
  GP asked how a company like Apple would be made more efficient by becoming a “DAO”. A DAO acolyte — miketery is assuredly invested in a closely linked cryptocurrency — then opined Apple would save money on dividend distributions by becoming a DAO. And that shareholder voting would become more efficient. Yet neither thing requires having a DAO, assuming efficiencies are even possible to obtain that way. I’m sorry, but I don’t see how what you posted is relevant to this discussion.
- lottin 5y ago
  I'm confused... what do you mean no one party has control over the funds? Surely the whole point of investing in a company is to transfer control of the invested funds to the company so that the company can do what it intends to do. Otherwise what are we talking about here?
  - chrisco255 5y ago
    The funds are in a smart contract on the blockchain. They are protected by code which ties the result of on-chain votes to the release or emission of funds. DAOs mean the users, the token holders, get to participate in the company governance directly. They get to post in forums, create campaigns for changes to protocols, and vote on whether to implement new proposals and how much funding to allocate to those proposals. Maybe that's hiring a new developer. Maybe that's launching a new feature. Maybe it's incentivizing growth through marketing or other grassroots strategies. It's incredibly flexible.
    - lottin 5y ago
      I see... so a DAO is corporation where shareholders are in charge of managing the company. It has no professional management, instead it's all managed by the shareholders democratically. If this is it, DAOs are probably a bad idea in most circumstances. There are good reasons why management is separated from ownership in modern corporations.
inter_netuser 5y ago
The only efficiency is fleecing suckers faster. DAOs are just unincorporated partnerships with anonymous partners.

chrisco255 5y ago

It does require a DAO. You need to know that no one party has control over the funds. Or they can screw the community. If the community is distributed the token in a fair way (and they'll know, since this is all blockchain and it's all visible), they can also inspect the code that protects the funds from being spent. So you can encode the mechanisms that protect the disbursements, and you can do this in a provable way. It's not some SQL database that's controlled by an admin key. It's not a bank account that the CEO has control over. All the funds are on-chain, in a smart contract, protected by code and cryptography. That aligns incentives in a powerful way that you can't replicate with stock ownership. You can't replicate it with a voting button on the Robinhood app. It is a fundamental shift in capital management and human coordination.

atweiden 5y ago
GP asked how a company like Apple would be made more efficient by becoming a “DAO”. A DAO acolyte — miketery is assuredly invested in a closely linked cryptocurrency — then opined Apple would save money on dividend distributions by becoming a DAO. And that shareholder voting would become more efficient. Yet neither thing requires having a DAO, assuming efficiencies are even possible to obtain that way. I’m sorry, but I don’t see how what you posted is relevant to this discussion.
lottin 5y ago
I'm confused... what do you mean no one party has control over the funds? Surely the whole point of investing in a company is to transfer control of the invested funds to the company so that the company can do what it intends to do. Otherwise what are we talking about here?
- chrisco255 5y ago
  The funds are in a smart contract on the blockchain. They are protected by code which ties the result of on-chain votes to the release or emission of funds. DAOs mean the users, the token holders, get to participate in the company governance directly. They get to post in forums, create campaigns for changes to protocols, and vote on whether to implement new proposals and how much funding to allocate to those proposals. Maybe that's hiring a new developer. Maybe that's launching a new feature. Maybe it's incentivizing growth through marketing or other grassroots strategies. It's incredibly flexible.
  - lottin 5y ago
    I see... so a DAO is corporation where shareholders are in charge of managing the company. It has no professional management, instead it's all managed by the shareholders democratically. If this is it, DAOs are probably a bad idea in most circumstances. There are good reasons why management is separated from ownership in modern corporations.

inter_netuser 5y ago

The only efficiency is fleecing suckers faster. DAOs are just unincorporated partnerships with anonymous partners.