4 ms·

> You can achieve anything you want to from a DAO with a corporation plus a twitter poll or SurveyMonkey thing. How would accept money from thousands of people

> You can achieve anything you want to from a DAO with a corporation plus a twitter poll or SurveyMonkey thing. How would accept money from thousands of people without being public? How would those ownership stakes be easily transferred?

arcticbull 5y ago
DAO tokens do not convey ownership, so, a kickstarter campaign. If DAO tokens do convey some ownership interest, then they'd have to be registered as securities - which is why DAOs are very clear that you get nothing but their appreciation in exchange for the tokens. In which case you'd sell them the same way you sell any other securities. Reg A+ and Reg CF allow the sale of equity for crowdfunding contributions, btw. There are even some marketplaces that sprung up around them.
- berberous 5y ago
  You are speaking categorically when that is not the case. If a DAO token is a security, it does need to be registered: it either needs to be registered or have available an exemption from registration. There are DAOs that try to fit within an exemption from registration. See the LAO, and it's offshoots, like Red DAO, Flamingo DAO, etc., which sell LLC interests to a limited number of accredited investors. [0] https://medium.com/openlawofficial/the-lao-a-for-profit-limited-liability-autonomous-organization-9eae89c9669c https://medium.com/openlawofficial/the-lao-a-for-profit-limi... [1] https://www.flamingodao.xyz/ https://www.flamingodao.xyz/
  - arcticbull 5y ago
    > There are DAOs that try to fit within an exemption from registration. See the LAO, and it's offshoots, like Red DAO, Flamingo DAO, etc., which sell LLC interests to a limited number of accredited investors. Ok, but that's just an LLC with extra steps no? If you're only accepting accredited investors then you're required to validate that they are accredited meaning that you have to pierce the veil of anonymity. It imposes legal control over the transfer of these tokens which means there's no reason whatsoever for them to be decentralized, permissionless and on the blockchain? Accredited investors were always welcome to buy whatever toxic garbage they wanted.
    - berberous 5y ago
      I think you are treating DAOs as a single monolithic idea, when it is more like an infant design space. I would say the core idea of a DAO is this: how can we organize a disparate group of people around a common goal, more easily than in the past? Whether you think they are a joke or not, ConstitutionDAO, SpiceDAO (which I think is the worst example in this space given their lack of diligence or thought on IP issues), OrangeDAO, FlamingoDAO, etc., are all unique in that they have organized a disparate group of people more quickly than in the past, and enabled them to more efficiently work together towards a shared goal. There are many ideas being explored: 1. Can we have better laws (like Wyoming is exploring) or regulations? 2. If the DAO is decentralized enough, are the tokens still (or should they be) a security? Are there better ways to regulate something like this globally? 3. How do you coordinate a disparate group of people? How should you let in new entrants, or weight votes? How should a DAO manage its treasury? 4. What happens if all voting proposals are public and verifiable on the blockchain? Is that good or bad? At it's core, yes, I think you can say that a DAO is basically the idea of a corporation, except with most of the discussion on Discord and with on-chain voting, and plus some securities laws issues that are at best gray areas and at worst, in some cases, clear violations. But I think that is ignoring that something worthwhile might come out of that design space.
      - arcticbull 5y ago
        I mean yes, that's fair, I am. Broadly though, it's because they seem to be unified behind the idea of issuing unregistered securities and selling them to un-accredited investors because they don't seem to think the registration of securities is valuable. I disagree, because, the Great Depression. They're not setting out to solve a limitation around business organization. You can do basically anything you want out of a Delaware LLC or C-corp except sell the shares to an un-accredited investor without registering them. There's even a light-weight way to do that with Reg CF and Reg A+. You want public voting? Ok, that doesn't require a blockchain and it certainly doesn't require a whole new legal framework for organizing a business. Twitter has managed to have polls for years. Most people actually trying to build a business of value aren't trying to reimagine the concept of a business. By all means, go with God, find a better way to organize companies. If they land one one, I'll happily use it. But so far all I see is grift, crime and frankly, little else.
garrickvanburen 5y ago
If you’re just asking about accepting money; PayPal, Stripe, Venmo, etc. To date: few DAOs are actually selling equity…more of a donation with a fancy membership / receipt. As equity requires a poking the veil of the DAO and setting up an LLC.

arcticbull 5y ago

DAO tokens do not convey ownership, so, a kickstarter campaign. If DAO tokens do convey some ownership interest, then they'd have to be registered as securities - which is why DAOs are very clear that you get nothing but their appreciation in exchange for the tokens. In which case you'd sell them the same way you sell any other securities. Reg A+ and Reg CF allow the sale of equity for crowdfunding contributions, btw. There are even some marketplaces that sprung up around them.

berberous 5y ago
You are speaking categorically when that is not the case. If a DAO token is a security, it does need to be registered: it either needs to be registered or have available an exemption from registration. There are DAOs that try to fit within an exemption from registration. See the LAO, and it's offshoots, like Red DAO, Flamingo DAO, etc., which sell LLC interests to a limited number of accredited investors. [0] https://medium.com/openlawofficial/the-lao-a-for-profit-limited-liability-autonomous-organization-9eae89c9669c https://medium.com/openlawofficial/the-lao-a-for-profit-limi... [1] https://www.flamingodao.xyz/ https://www.flamingodao.xyz/
- arcticbull 5y ago
  > There are DAOs that try to fit within an exemption from registration. See the LAO, and it's offshoots, like Red DAO, Flamingo DAO, etc., which sell LLC interests to a limited number of accredited investors. Ok, but that's just an LLC with extra steps no? If you're only accepting accredited investors then you're required to validate that they are accredited meaning that you have to pierce the veil of anonymity. It imposes legal control over the transfer of these tokens which means there's no reason whatsoever for them to be decentralized, permissionless and on the blockchain? Accredited investors were always welcome to buy whatever toxic garbage they wanted.
  - berberous 5y ago
    I think you are treating DAOs as a single monolithic idea, when it is more like an infant design space. I would say the core idea of a DAO is this: how can we organize a disparate group of people around a common goal, more easily than in the past? Whether you think they are a joke or not, ConstitutionDAO, SpiceDAO (which I think is the worst example in this space given their lack of diligence or thought on IP issues), OrangeDAO, FlamingoDAO, etc., are all unique in that they have organized a disparate group of people more quickly than in the past, and enabled them to more efficiently work together towards a shared goal. There are many ideas being explored: 1. Can we have better laws (like Wyoming is exploring) or regulations? 2. If the DAO is decentralized enough, are the tokens still (or should they be) a security? Are there better ways to regulate something like this globally? 3. How do you coordinate a disparate group of people? How should you let in new entrants, or weight votes? How should a DAO manage its treasury? 4. What happens if all voting proposals are public and verifiable on the blockchain? Is that good or bad? At it's core, yes, I think you can say that a DAO is basically the idea of a corporation, except with most of the discussion on Discord and with on-chain voting, and plus some securities laws issues that are at best gray areas and at worst, in some cases, clear violations. But I think that is ignoring that something worthwhile might come out of that design space.
    - arcticbull 5y ago
      I mean yes, that's fair, I am. Broadly though, it's because they seem to be unified behind the idea of issuing unregistered securities and selling them to un-accredited investors because they don't seem to think the registration of securities is valuable. I disagree, because, the Great Depression. They're not setting out to solve a limitation around business organization. You can do basically anything you want out of a Delaware LLC or C-corp except sell the shares to an un-accredited investor without registering them. There's even a light-weight way to do that with Reg CF and Reg A+. You want public voting? Ok, that doesn't require a blockchain and it certainly doesn't require a whole new legal framework for organizing a business. Twitter has managed to have polls for years. Most people actually trying to build a business of value aren't trying to reimagine the concept of a business. By all means, go with God, find a better way to organize companies. If they land one one, I'll happily use it. But so far all I see is grift, crime and frankly, little else.

garrickvanburen 5y ago

If you’re just asking about accepting money; PayPal, Stripe, Venmo, etc. To date: few DAOs are actually selling equity…more of a donation with a fancy membership / receipt. As equity requires a poking the veil of the DAO and setting up an LLC.