Coinbase’s first employee: why DAO is the second biggest breakthrough in blockchain

DAOs, which exist as smart contracts on the ethereum blockchain and enable people to collaborate in a hierarchy-free organization, have started to come into their own in recent months.

Coinbase's first employee: why DAO is the second biggest breakthrough in blockchain

Recently, Vitalik Buterin, the founder of Ether, spoke about decentralized autonomous organizations (DAOs), decentralized governance, and DeFi. DAOs, which exist as smart contracts on the ethereum blockchain and enable people to collaborate in a non-hierarchical organization, have come to prominence in recent months.

At the end of April, the Wyoming Legislature officially approved the Decentralized Autonomous Organizations Act and it has been signed by the governor, which means that DAOs can be registered as limited liability companies in the state, and the bill will officially take effect on July 1. This move could pave the way for other U.S. states to follow suit. The Wyoming bill would allow state and federal recognition of decentralized autonomous organizations to be expanded, similar to that enjoyed by other businesses. Caitlin Long, CEO of Avanti, a digital asset bank, noted that decentralized autonomous organizations are jointly and severally liable to all participants in a decentralized autonomous organization if the organization is deemed a general partnership by the court. The key to the bill is that unlike a general LLC, the Wyoming Secretary of State can remove liability protection for a decentralized autonomous organization that commits fraud or engages in illegal activity (unlike a general LLC). As a result, this law can only be used and consulted on valid projects, and is useless for invalid projects.

Olaf Carlson-Wee, founder and CEO of San Francisco-based venture capital firm Polychain, which controls nearly $600 million in assets under management, founded the venture capital firm in 2016.Olaf Carlson-Wee, who was 26 years old at the time and was also Coinbase’s first employee The first breakthrough in blockchain technology, according to him, was the creation of “digital currencies” and the second was decentralized autonomous organizations – DAOs. He has seen how capital can be coordinated in decentralized financial revenue farming and initial token offerings, and how markets can transform so quickly, when many people have not yet realized the importance of decentralized autonomous organizations.

Decentralized autonomous organizations are using automated decision-making processes and ethereum smart contracts to enable real-world governance of institutions, including traditional corporations led by boards of directors or other shareholder-led companies. Anyone who holds tokens for the project in question can participate in project decisions, such as how to structure the protocol and how to spend the organization’s internal expenses, and today some decentralized autonomous organizations control billions of dollars.

Olaf Carlson-Wee, as the founder of Polychain, has been following the current developments in the decentralized finance industry. About a year and a half ago, the size of funds raised by decentralized autonomous organizations was only about $1 billion, but today, the size of funds raised by decentralized autonomous organizations has reached about $75 billion, with decentralized autonomous organizations’ funding growing faster than even the two largest cryptocurrencies by market capitalization: bitcoin and ethereum.

In fact, the amount of money raised by decentralized autonomous organizations is even larger than IPOs, with Olaf Carlson-Wee predicting that the total amount of money raised by decentralized autonomous organizations will exceed $1 trillion in the next year. Not only that, but Olaf Carlson-Wee also predicts that as decentralized autonomous organizations become more complex, the challenges they can address will become more extensive. This is because as the range of applications managed by decentralized autonomous organizations grows, it will drive the market for more platforms that support scalability, and developers will have the opportunity to explore more and more logically complex platforms. The applications managed by decentralized autonomous organizations are more like traditional web applications, websites or file sharing and storage applications.

While a governance platform running on software is more attractive than a traditional governance system, especially since many traditional governance systems are tied to “jurisdictions,” Olaf Carlson-Wee admits that there are still some problems with decentralized autonomous organizations at this stage, such as the difficulty of figuring out how decentralized autonomous organizations distribute funds. Therefore, we should see more “DAO experimental models” in the coming years, for example, some for-profit companies will seek financial support based on decentralized autonomous organizations, and they will also act as decentralized autonomous organizations “contractual parties “, so that they can learn something beneficial from for-profit companies.

While decentralized autonomous organizations currently manage about $75 billion in funds, Olaf Carlson-Wee is optimistic that this figure will soon reach $1 trillion. I believe that time will tell, and that the future of decentralized autonomous organizations is promising, and will form the latest organizational change in the world while reaching a vision of integration with the traditional financial sector.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/coinbases-first-employee-why-dao-is-the-second-biggest-breakthrough-in-blockchain/
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