【Abstract】David verifies the consistency of DAO and communism by replacing the word communism in communism theory with DAO . At the same time, he discusses three important issues concerned by Marx: ownership of means of production, current assets and investment. Meaning, these three problems neatly correspond to the three major categories in Web3: NFT, Defi and DAO. What a coincidence this is! Sara believes that Marx’s theory avoids rather than resolves the contradiction between the collective and the individual, especially the sensitive issue of workers’ property that Marx has avoided answering. But Marx also pointedly pointed out that the violence of supply and demand is real violence, and the relationship between supply and demand makes the priceless but rare things go to sky-high prices. Isn’t this the controversy facing NFTs today? The most terrifying aspect of capitalism’s materialization is that it places worthless hype assets over truly meaningful love and affection. Perhaps this is the root cause of the moral collapse of capitalist society.
The authors conclude that communism and Web3, although similar in their philosophies and similar in many details, are fundamentally different. That is to say, Marx is centralized, planned, and determined to abolish private property, while Web3 is decentralized, market-based, and protects and even spoils private property. Of course, maybe Web3 will be more organically combined with Marxism in the future? The real theory and DAO should have the well-being of all mankind as the ultimate goal, not rigidly bound to have to be the market or the economy, left or right. Maybe Web3 can solve the paradoxical flaws of Marx’s theory and revolutionize the concept of communism? Maybe DAO is the new communism that can truly achieve harmony in the world? Would society be better off if, as Marx and the communists advocated, the small self and small ownership were abandoned for the big self? Will this become the ideological stamp of the morality of the few kidnapping the majority? Today, the development of Web3 technology has given communism an opportunity to experiment again. Marx and his communism should make full use of the advanced nature of Web3, and Web3 should also learn from the ideas in Marxism to solve self-interest in a decentralized society. question.
On the other hand, the author admits that compared to real fixed assets, working capital and digital currency objectively reduce friction and bring efficiency to social production. And when cryptocurrencies flow unregulated, it means they no longer have to serve fixed assets, and it means we have to redefine economic logic. Due to the existence of tokens, currency exists twice in the DAO. The main purpose of the equity of tokens is to speculate instead of being obsessed with production, which makes the fraud risk of junk projects difficult to control and uncontrollable. The crypto-economy could bring about a more difficult-to-control economic crisis. So until the Web3 theory is completely confirmed, we have to open this Pandora’s box with caution. We believe that blockchain technology will bring about cross-generational changes to the exploration of human social systems from the perspective of technology and ideology. Will Web3 allow humans to choose their own lives more freely, or will it bind us more firmly? This answer may require each of us practitioners to explore for a lifetime.
Author: Sara Campbell, David Phelps｜Translator: huasi sui｜Proofreader: han tang｜Typesetting: Queeny
In an interview with Crypto, Culture, & Society (CCS), David Phelps talks about what we can learn from Marx about Web3. David Phelps is the chief investor of Cowfund, co-founder of ecodao & jokedao, and author of Three Quarks.
There are many reasons why the claim that Web3 has made us all Marxists is inappropriate, perhaps the most convincing than the fact that the Web3 bigwigs actually hate Karl Marx.
Take Nick Szabo, an academic, cryptographic guru and inventor of the prototype Bitcoin — occasionally rumored to be Satoshi Nakamoto — who agonized over Marxism’s incitement to closed societies. To quote Szabo himself, “How can a sick brain become so sick?”
Also look at Soleimani, creator of Moloch DAO, RAI, and SpankChain (one of the truly most innovative and influential figures in the field), who not only publicly agreed with Saab, but argued that, through KGB psychological tactics, ” America has been eroded by a virus of Marxist thought . ” When the poor are told what they want to hear—that they are equal to the rich, the seeds of social unrest are planted, he writes.
However, it’s not just cryptographers on the right who believe that Web3 is not fundamentally Marxist; the extreme marketization of cryptocurrencies also means that many on the left also understand cryptocurrencies as an accelerated form of capitalism.
In some ways, cryptoeconomics also approximates the opposite of the commons: enclosures, as what was once jointly owned is subdivided into ownable, tradable assets, Schneider recently wrote. For Schneider, this hyper-financialization will give value to “things that were previously difficult or impossible to buy and sell, from cryptographic power to real estate in digital games,” by making them artificially scarce. It privatizes something that would have been freely available to everyone.
At the same time, arguably the most important technologist on the left, Corey Doctorow, accused DeFi of “shadow banking 2.0,” which created huge risks for the economy while making the 1% rich. He writes that if all the money is owned by the same group of billionaires, it makes no sense how banks are distributed. (In fact, about 0.01% of Bitcoin owners own 27% of the wealth.)
So how blue is it that let’s think Web3 could be a Marxist encryption pill? (The stalk of The Matrix)
How can we get this answer?
Well, let’s answer this question first, or rather, another overarching question: Can Neo-Communism be… a DAO?
Back in October, David conducted an experiment to retweet three paragraphs of Marx’s German ideology by replacing the word communism with DAO. You can judge its effect for yourself.
(Communism) The original text is as follows: The communists do not completely oppose selflessness and egoism. They know all too well that egoism, like selflessness, is a necessary form of personal self-assertion… Throughout history, “general interests” have been created by individuals who are defined as “private”.
Note the paradox here: the collective can only function while satisfying the self-interested needs and aspirations of its individual members, without compromising their individual sovereignty.
This contradiction recurs repeatedly.
(Communism) The original text is as follows: The real intellectual wealth of an individual depends entirely on his real network wealth. Only then can the independent individual be freed from various national and local boundaries… This communist revolution will transform total dependence into the control and conscious mastery of these powers, which have hitherto been independent of Forms other than people, completely alien, rule people.
Note again the paradoxical emphasis on individual sovereignty as the foundation of collective emancipation.
This paradox is also the key to a fundamental departure from Marxism.
(Communism) The original text is as follows: The modern state, the rule of the bourgeoisie, is based on freedom of labor. Labor freedom is free competition among workers. On the contrary, the free activity of communists is the creative expression of life resulting from the free development of all faculties of the whole person.
Once again, we feel the same contradiction. True collective freedom means individual freedom to do whatever they want.
But note, more broadly, that this is inherently contradictory. Marxism is not so easily reduced to an understated solution or a boastful slogan, let alone the horrors of twentieth-century National Socialism. For, when we understand Marxism as a dialectic rather than a doctrine (i.e. a series of contradictions and paradoxes), we can understand one of its main points of value: as we will see, it may be fundamentally unanswered questions frame.
Therefore, for the purpose of this article, we will discuss three questions raised by Marx. Each issue contains the contradiction between individual sovereignty and collective collaboration, and also involves the three current mainstream categories of Web3: NFT, DeFi and DAO.
Q1: Are the means of production owned by workers, or has the concept of ownership been abolished? (NFT)
This is obviously a difficult question to answer: in his writings did Marx advocate the general abolition of property and ownership? Or does he advocate a redistribution of ownership to the proletariat – that is, for the proletariat to own the means of production?
The issue even runs through a principled document like the Communist Manifesto, which toggles between trying to wipe out property and trying to hand it over to workers. Marx and Engels wrote in them that the distinctive feature of communism is not the general abolition of property. In this sense, the theory of communism can be summed up in one sentence: the abolition of private property.
In short, this contradiction exists between the lines.
Marx and Engels tried to cover up this contradiction, explaining on different points that communism is just abolition of private property (not property in the broad sense, don’t worry about union workers!), the real point is to deprive the bourgeoisie of its ill-gotten gains. However, they don’t have a good answer as to whether communism will destroy workers’ property. In this way, they argue, the development of industry has largely destroyed the property of the workers and continues to destroy them every day. This is a moot question because we all know exactly what happened in history (manual dog head).
Apparently this is a rhetorical avoidance to avoid the issue of worker ownership – as we can see Marx’s paradox over and over again in all the anti-property arguments of the Communist Manifesto. Giving workers ownership of the means of production means getting rid of ownership as we know it. In The German Ideology, he wrote that with the abolition of the basis of private property, people regained their modes of exchange, production and mutual relations under their own control.
The opposite system (as opposed to communism), Marx wrote, is that trade rules the world through supply and demand. Wealth and debt are distributed under this relationship, empires are built and empires overthrown, leading to the rise and disappearance of nations. The tyranny that Marx feared was not the tyranny of tyrants, but the tyranny of supply and demand. Because this is the tyranny of misrepresenting what really matters most to us, be it food or love. NFT critics should share the point here: Supply and demand assign value to items not according to what they mean to us, but only according to their scarcity in the market.
So obviously, Marx’s theory and Web3 are inconsistent.
So what happens when workers control the means of production? Marx and Engels described such a utopia:
As soon as the distribution of labor appeared, each individual had a specific, exclusive sphere of activity, which was imposed on him. He is a hunter, a fisher, a herdsman, or a critic, and he must remain so if he does not want to lose his means of subsistence; and in a communist society everyone can achieve something in any sector; but society regulates the regulation of general production , thus enabling me to do one thing today and another tomorrow, hunting in the morning, fishing in the afternoon, raising cattle at night, and criticizing after meals, because I am a free body of thought, not necessarily a hunter, Fisherman, herder or critic.
—Marx, Engels: The German Ideology
The most important means of production is not the factory, but time—and more importantly, our own sense of self that stems from the fact that we have free time. This gives us the sovereign right to live the lives we want, to work as hunters, fishermen, herders and critics, rather than being hunters, fishermen, herders and critics, defining ourselves in the role of profit creation.
But again, note that there’s a contradiction here about the roles of the individual and the collective – if we’re all doing whatever we want, especially in a Web3 environment, how does society work collectively? Who is disposing of the sewers and taking out the trash? Perhaps none of this is necessary if we live in sustainable small communes; Marx simply implies that “society regulates production in general”. But who is this society?
Rather than trying to answer the question directly, can we reframe it in more familiar terms? For we might argue that this contradiction—whether abolishing ownership or allowing workers to own the means of production—actually reflects a deeper contradiction. As individuals, should we aspire to the sovereignty of our identities (in today’s terms, our data and reputation)? Or would each of us be better off if we gave up this private sovereignty so that we could better support society and each other’s collective needs?
In fact, we can take these questions deeper into the deeper contradictions at the heart of Web3: Do we want ownership over the products of our labor, or do we want them to be open source and available to anyone?
One way to understand this contradiction is to understand the emergence of the creator economy over the past decade. Taking a step back, we can think of the creator economy as one of the origins of Web3 culture. It’s not just a product of permissionless user-generated content (TikTok, Twitter), but a product of the freelancing economy and the general trend of self-employed entrepreneurs – self-employed entrepreneurs who can Get paid.
It sounds like the creator economy has culturally conveyed our belief that artists should own the means of production. For example, the creator is an ordinary Tiktok blogger with means of production, not a Hollywood celebrity; the means of production is not a DAO prototype, but a hyped real estate. – As long as it’s not the product of a creation based on “100 loyal fans” monetized for free to prioritize scale.
Taking a step back, we can see that the creator economy is actually the culmination of the failure of the gig economy, which has dominated the past 40 years by virtue of the promise of worker sovereignty and the reality of worker isolation. Initially, freelancing was an attractive proposition for companies to pay for what they needed—or rather, pay for nothing, as David Harvey wrote in *Conditions of Postmodernity* As pointed out in: Surplus labor pushes for more flexible work systems and labor contracts.
Ironically, the creator economy is now threatening those legacy companies as well, as the hierarchy of the corporate ladder has disappeared in the face of a new ideology of working for themselves.
But at a time when 35 percent of U.S. workers are gig workers, this commitment to being a fisher, hunter, and critic at will also means giving up structures of steady pay and accountability support, with the safety and security of freelancers more reliant on workers’ rights than they are. Less than ever – because freelancers are on their own.
Likewise, the creator economy promises us a Marxist vision where anyone can be successful as an artist, but only through platforms that extract excess profits from the workers who make them successful. It’s the same for Uber drivers, for TikTok bloggers. This, we can say, is the price of open source for freelancers: anyone can freely use their work, while the platforms they operate on remain siloed and deeply monetized. In other words: Freelancers get open source, but platforms get ownership.
So what is the answer? It can be said that Web3 is a response to the failure of the corporate ladder and the polarization of the economy, with isolated companies on the one hand and freelancers with open markets on the other. This is where we come back to why we seek answers from Marx. Because our independent sovereign commitment to hunting and fishing at will will only work if there is indeed a “society” to “regulate general production”. We can only own our work and provide each other if we are also willing to give up giving priority to the collective good in favor of each other.
Obviously, DAOs are an answer we’ll come back to later – a form of company-like consensus that allows us to share jobs without permission, earn money from jobs, and give up personal ownership of jobs.
But simpler models are NFTs.
On the one hand, NFTs represent creators who ultimately get paid directly for their work. On the other hand, this ownership is clearly a social construct based on infinitely replicable jpegs, which are open source.
In other words, NFTs provide us with a vision of what it really means for creators to own the means of production (their art) and capture the full value of what they create, even if the work itself is not private property at all, but is open to everyone. Creators give up ownership to make it work.
Q2: Is working capital a disease or a medicine? (iDeFi)
Ownership issues don’t just include assets. It also involves the question: should we be independent of centralized institutions such as banks or even governments and own our own money? These institutions used the money to finance everything from subprime mortgages to wars. Or does this facilitate massive financial abuse, money laundering, hacking, scammers and extreme volatility without government oversight?
In other words, are we our own best financial custodians?
Technically, what we’re asking is whether liquid capital is at the heart of capitalism’s contradictions — or, in fact, the solution to capitalism’s deepest problems? This circulating capital is what Marx calls “circulating capital” in the *outline*, capital that can be easily converted into liquid cash and equally easily into commodities. This “floating capital”, Marx wrote, is independent of each particular form, and can get rid of or adopt any one of them as an equivalent incarnation. In other words, like a ghost in the form of the commodity it possesses, liquid capital can take on any form and is not limited by a particular context or domain of use.
By contrast, let’s isolate some of the key properties of illiquid fixed capital and see why liquidity might help address some of capitalism’s main challenges.
- is infrastructure (machinery, factories, airports)
- Usually single-use (assessed by use)
- Requires substantial loan upfront cost
- Requires significant investment to build and maintain excess inventory
- Absorb residual value (companies charge more for goods than they cost to manufacture)
Note how fixed capital is at the heart of some of the most predatory aspects of capitalism: overcharging for work, underpaying workers, and constantly making huge loans for currencies that don’t yet exist that need more and more more production, thereby allowing the economy to produce more and more money to satisfy interest rates.
Liquid capital, on the other hand, does not have this problem.
- No geographical restrictions
- Can be used to represent any item or commodity
- can be used for any purpose
Fully Liquid Working Capital Working capital faces no friction, no time and place frictions and costs such as recessions, overstocking and upfront costs that require large amounts of money that must be returned at a premium later.
So when we define liquid capital in this way, we might think of it as something else: digital currency.
- No geographical restrictions
- Can be used to represent any item or commodity
- Composable and Programmable
- can be used for any purpose
In other words, can digital currencies or cryptocurrencies be the solution to scarcity in the physical world?
Not so fast. There is also a view that this “pure capital”, this capital that is not tied to real world or actual use, has value because it facilitates the development of systems of loans, surplus value, excess inventory, etc. As David Harvey wrote in “Reading Capital with David Harvey”, liquid capital occurs when money is put into circulation to obtain more money. Its purpose is to nurture more capital, leaving us tethered to the fact that we must often work for less than wages to generate more value to pay off monetary loans that don’t yet exist.
So what happens when fully liquid capital, unconstrained by time, space, government regulation, or traditional financial models, can be instantly deployed anywhere in the world at will? Can online operations enable, for the first time in history, an economy where working capital does not need to service fixed capital? Or, as NFT critics claim, does this mean we need to rebuild the scarcity dynamics that underpin the economics of supply and demand in order for digital products to have value?
In other words, are we creating shadow banking 2.0 and risking all unregulated criminal activity, or are we rebooting Occupy Wall Street 2.0?
Recently, Hillary J. Allen made a very convincing case of a liquid money economy leading to stimulant capitalism. Endless liquidity means it’s easier than ever to over-leverage, and to make things riskier in a financially related situation there is no federal bank to shore up the derivative margin calls that could result. If every transformative technology has experienced massive financial bubbles that drag down economies when expectations outpace innovation, then we can only speculate when the next generation of technology itself enables large-scale, unregulated lending , how terrible the collapse would be. Recently, Hillary made a very convincing case of a liquid money economy leading to steroid-pathic capitalism. Endless liquidity means it’s easier than ever to over-leverage, and to make things riskier in a financially related situation there is no federal bank to shore up the derivative margin calls that could result. If every transformative technology has experienced massive financial bubbles that drag down economies when expectations outpace innovation, then we can only speculate when the next generation of technology itself enables large-scale, unregulated lending , how terrible the collapse would be.
However, there is a contrary view as follows.
Because we can also say that liquid capital enables financial sovereignty because we no longer need intermediaries that benefit from our money. It turns out that financial sovereignty applies to anyone who has ever put money in a bank, just as it applies to workers. Returning to the labor paradigm, we can imagine that just as workers are paid far less than the value they provide to the factory, we depositors are paid far less than the value we have historically provided to the banks. (And savers also have to pay the government to bail out the banks).
The premise of DeFi is that we don’t need to get paid for banks’ success, and we no longer have to pay for banks’ failures, without getting paid for their success. Because now, we can serve ourselves as lenders. In the traditional banking paradigm, like you would deposit $1 in the bank, the bank would lend it to someone else, so you and another lender would each receive $1, the bank effectively earns $2 by generating $2 in the economy Take your money while making you an unwitting, unconsensual, and no-yield lender. (I’m simplifying for a simple example, but this is the principle of money multipliers and bank runs.) This is simply not possible in DeFi, because you can provide liquidity to the market yourself, or, if you wish, deposit $1 And get a synthetic token representing its value. Now, there is also $2 in the economy, but one is fully collateralized and the other is yours.
This is what we mean when we say DeFi is backed. It is clear that we are moving towards a future scenario of dealing with real world fixed capital, namely undercollateralized loans and crypto-generated loans; however, financial sovereignty gives us volatility as it enables us to be our own lenders and market makers, and The loser in the absence of a state.
Which begs the question: Maybe we should create money out of thin air to stabilize the economic system?
This brings us to the last part of the topic: DAOs.
Q3: Can investing allow us to live the life we want? Or force us to be in constant debt for the future we want? (DAOs)
Investing with the expectation of a return is putting money into the world and hoping for more money in return – which raises the question, where is more money coming from? What creates new value?
Exploitation of the poor and expropriation of land are two answers to this question, and while Marx’s views are often intertwined with the former, his main concern in Capital is the third: debt. For Marx, debt is fictitious capital: an obligation to future money that doesn’t officially exist, but debt itself. To take the example from “Marxist Ray Dalio”, if I lend my friend $5, they write me an IOU (IOU) that I can now use as collateral with other friends goods, or even as money—that way, it’s $10 instead of $5, and more if we count interest.
We might expect Marx to denounce the entire capitalist enterprise system as a hoax based on IOUs, and if these “IOUs” were used, the economy would collapse. But in fact, Marx makes a crucial distinction here, that investments in companies—stocks—represent real capital precisely because they are not IOUs and can “exist twice” as loans and money.
The stock of railways, mines, nautical companies, etc., representing real capital, that is, capital invested and operated in such enterprises, or the amount advanced by shareholders as capital advanced in these enterprises for the purpose of using the capital, is real capital. This does not rule out the possibility that these may represent pure scams. However, this capital does not exist twice as capital value as ownership (stocks) on the one hand and as actual capital invested or to be invested in these businesses on the other.
—Marx, Capital, III.29
Note the difference between debt and investment. With debt, your $5 loan will always be worth $5 (plus interest), so your IOUs can easily become money or collateral. However, for investing, your $5 cannot be seen as $5 at any time as you would like: its value depends on the value assigned by the market, rising or falling over time. In other words, investing is not the same as debt, because investing does not guarantee that you get a return that money exists twice, first as the amount to be repaid (the commission) and second as the amount used or loaned out (the loan itself).
Equally important, investments are not what Marx calls “virtual capital” because they are not “interest-bearing capital,” which Marx defined as “the accumulation of production demands, the accumulation of market prices.” For the perfect embodiment of this “fictitious capital”, Marx points us to state bonds: because bonds need to repay interest, and they cannot actually generate themselves, they actually create money out of thin air. (It’s also a stark example for anyone living in the context of twentieth-century National Socialism, who believed that Marx at all times advocated for an all-powerful government to regulate business.)
However, there is a slight pitfall in the public market that turns into a sizable pitfall in the private market. That’s because — where did that stock’s valuation come from? Well, it comes from expected ‘future’ returns from companies that we hope will do well.
So we actually make money out of thin air. If I invest $2 million in your company at a $20 million valuation, then my $2 million is real capital, but the other $18 million was just created out of nowhere as a mythical entity that we hope due to future Monetize to gain value. These valuations, like debt, are claims on future production.
To Marx, this trap didn’t matter, because there has traditionally never been a way to exploit these claims, or use them as capital: as long as the IOUs cannot be traded as their own money, money doesn’t exist twice.
But in the case of DAOs, money suddenly exists twice – because now we have replaced stocks with tokens that can be traded, bought, or invested in (assuming the SEC allows us to do so).
But there’s another, bigger problem at play — DAOs allow anyone, anywhere, to create what is essentially a token of a future value proposition, and raise money from anyone they want. Now, anyone can enjoy the benefits of fictitious capital without having to worry about actually having to pay it back with interest.
We can begin to realize the risks that DAOs pose to the financial system. Many of these investments will not get their valuations, and the democratization of finance without proper education provides ample opportunities for fraudulent or even failed projects to defraud investors who cannot do their due diligence.
But even so, by creating our own currency, DAOs can also help us innovate and invest in our projects in ways that have never been possible before Web3. Owning your own work is one thing. Being able to fund the work you want to do is another aspect – it’s what enables the real collective of workers to control funding and remove the barriers of labor and capital. Because right now, you can imagine DAOs “investing” in each other by exchanging tokens under the protocol to back each other’s projects. Unlike traditional investment ecosystems, where capital (investors) on one side and labor (founders) on the other, a DAO-to-DAO token swap means that each party controls the other.
In other words, DAOs embody all the paradoxical relationships we discussed above: workers having sovereignty vs autonomy giving way to collectives; liquid capital enabling financial autonomy vs driving us to a world of illusions where we can only see future investments and returns Unreal world; real capital to invest in the projects we create vs virtual capital to use that money to fund future value. If there are no clear answers to these paradoxes, these questions, at least there are multiple options.
Ironically, this optionality seems to be unique to Marxists. In an age of massive hyper-financialization and multi-billion-dollar venture capital, this may be the true meaning of DAOs; and in the shadow of the corporate and gig economy, even venture capital firms are now behaving like the real Marxists Why: The great goal of Web3 is not just to give creators financial sovereignty over what they are creating, but to give everyone a choice about what to create according to their desires.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/can-neo-communism-be-a-dao/
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