From nautical trade to meta universe: from company system to DAO

DAO, or Decentralized Autonomous Organization, is a digital world organization based on blockchain technology. Its organizational rules are executed by distributed programs, which can align the interests of participants and jointly achieve organizational goals.

DAO has several major characteristics: information transparency, token incentives, code open source, community autonomy, participants have ownership of the organization, and freedom and openness. The biggest difference from the company is that the DAO organization is not organized by law and contract. Users in different jurisdictions and even artificial intelligence can form a DAO.

The DAO in the meta-universe digital age is like a modern company system that is developing rapidly in the era of great navigation. The transformation of the production environment has given birth to new organizational methods. From the great nautical era to the meta-universe, the organizational form will continue to change and evolve.

Nautical Trade and the Development of Modern Company System

In the 16th century, the rapid development of maritime trade prompted the emergence and development of modern companies. The British East India Company and the Dutch East India Company were established one after another. It is generally believed that this is the earliest origin of modern companies. Changes in the production environment will promote the transformation of organizational forms. The production environment determines the organizational form. In an academic study published in 2017, the author combined institutional analysis and quantitative methods to extract the following two cores that promote the rise of the company system : First, transoceanic trade is booming, and the demand for long-term large-scale investment is fierce; second, the system of sovereign government begins to stabilize, and the risk of the government (especially the royal family) grabbing private wealth has decreased.

Without innovation in organizational forms, the development of social productive forces will be hindered. Before the existence of companies, individual business and partnership organizations were the foundation of business. These organizational forms had a series of limitations: lack of an agent system, decision-making often required the unanimous consent of partners; enterprises and individual assets were not isolated, and individuals assumed unlimited liability. And any partner has the right to request liquidation of the enterprise. The rules of this kind of enterprise make it difficult to concentrate investment for a long time. You can only do small things such as opening restaurants and building workshops. Things like building railways, building bridges, and flying satellites to the sky are simply impossible. Therefore, without the invention of the company in this commercial field, human society will suffer more obstacles when it steps out of feudal society.

Compared with traditional enterprises, modern companies have the following characteristics:

1) All shareholders do not know each other. Before this, the companies were almost all family-owned, and there was a certain blood relationship between each other. The shareholders of modern companies have surpassed the limitations of previous shareholder status.

2) The separation of ownership and management power, and the decision-making power is controlled by the board of directors, has also become a prerequisite for the development of the modern professional manager system;

3) Shareholders bear limited liability and no longer assume unlimited liability like the previous company.

4) As an independent legal person, the company has an independent legal person status. The company conducts production and operation with independent will and assumes responsibilities independently.

Under these characteristics, the company has expanded the scope of the organization, enhanced organizational execution, reduced investment risks, and can engage in larger-scale investment and production, and has become more flexible than before.

The production and consumption of digital content and the rise of DAO

The term “community” is translated from the English Community. In sociological research, the community is described as “a close, watchful, supportive, and shared emotional social group composed of a homogeneous population of common values.” It has a strong regional character. The development of the Internet has weakened the geographical influence, allowing people living in different geographical areas to communicate. The “residents” of the online community often have certain common hobbies or emotional tendencies.

The production and consumption of digital content is inseparable from the community. After the community gathers a group of people with the same interest, a large amount of digital content is produced for consumption in internal communication. This digital content includes but is not limited to: news, stories, open source software, images, translations, videos, reports, virtual IP, etc. In the early bbs, the moderator’s management and information creation of the forum can be regarded as a kind of digital content production of text.

Hatsune Miku is a typical community-operated IP. Its prototype is a sound source library for speech synthesis technology. Its unique feature is that it lays the foundation for an incubation model for virtual idols. The community is directly involved in creating value, and sharing and disseminating it online, “I support idols” has become “I create idols”. The open source software community is generally composed of people with common interests and hobbies, and plays a huge role in promoting the development of open source software. The digital content production of the open source software community not only meets internal needs, but also promotes the entire Internet industry. develop.

Although the community produces a large amount of digital content, it has major limitations in terms of commercialization, collaboration, and incentives. Community creation is not like a company that meets customer needs through products and services. These content production is more because of the love of users and their willingness to “use love to generate electricity.” Therefore, community defenders often set up companies to operate. Companies generally undertake community infrastructure construction, products, and commercialization. However, the production, consumption, and collaboration in the digital world are different from those in the traditional world. Companies are concerned about this production environment. The incompatibility has initially appeared.

The inadaptability of the company’s organizational model in digital production:

(1) Production and consumption in the digital world are naturally cross-sovereign, but the threshold for multinational companies is high, and the costs of cross-border collaboration and trust are not borne by a small team.

(2) In digital production, market competition is intensified, the role of people is enlarged, and the importance of other production factors is reduced. This kind of market environment is more suitable for decentralized small organizations.

(3) Open source and commercial value are difficult to consider at the same time under the goals of the company’s organization, because the company obtains benefits by providing services and products, and open source infrastructure is difficult to generate commercial value for the company, but open source projects are an important foundation for the development of the digital world.

(4) It is difficult for companies to capture the commercial value of the community’s spiritual level. In the digital age, spiritual consumption is more important than material consumption. Some “power generation for love” creations meet the needs of the community but are difficult to capture value, such as secondary creations and memes. Spread etc.

The rise of DAO has allowed the community to explore the second way of commercialization. DAO is the abbreviation of Decentralized, Autonomous, and Organization. From a literal understanding, decentralization is the decentralization of rule-making and execution, and autonomy is that the community determines its own rules.

DAO generally refers to an organization realized through technologies such as blockchain, smart contracts, and token economy. Participants have a common goal and collaborate remotely through the network, using codes rather than laws to protect interest relationships. The development of DAO relies on blockchain technology. The blockchain smart contract platform guarantees the credible operation of the code, enabling the organization of rules to be programmed, and the power to formulate rules is handed over to the community through program design. The development of the token economy is mainly reflected in the exploration of decentralized financial facilities, token governance tools, and token mechanisms (such as liquidity mining). These ecological applications provide DAO with financial tools for consensus cohesion and community incentives.

Compared with the company, DAO has the following characteristics:

1) The organization rules of DAO are run by the program independently, and the ultimate guarantee of the organization rules is the code rather than the law. The blockchain technology guarantees the decentralized operation of the program, and the program rules restrict the members of the organization. This kind of pre-constraint enables DAO to form an organization in a lower trust model, and users can participate in the organization anonymously and transnationally.

2) The identity boundary between participants and owners disappears, and DAO participants are generally token holders. In addition to the rewards for participating in the construction of the project, participants can also share the economic benefits brought about by the development of the organization; and this unification of benefits further strengthens the organization’s consensus.

3) DAO’s information is transparent, most of the project code is open source, and any user can get all the information of the organization. It can be said that compared with companies, DAO does not set information thresholds, which stimulates internal competition within the organization to the greatest extent. With strong ability, any participant supported by the community will quickly reach an important position, leading the development of the business, and the utility of ability and reputation will be maximized.

4) DAO is free and open, users can work for multiple DAOs, and can also exit at any time. Of course, a small number of DAOs have set entry barriers, but they are often very early projects. This feature brings two main benefits. The first is that the resource flow between DAOs is more efficient and frequent than that of companies, and the information communication between industries is particularly in-depth, which greatly accelerates innovation and resource allocation, and makes blockchain a development speed. One of the fastest industries; the second is that users enter and exit at any time. Participants with the same goals enter the organization, and those who are dissatisfied with the organization’s route exit at any time, so that the organization can reach a consensus faster.

5) DAO does not need a tight organizational structure, but makes decisions in a decentralized manner. Different from the company, DAO’s decisions are made collectively, not by the CEO or senior management. The change and implementation of the rules are in place in one step. In fact, members who own one or a predetermined number of DAO native tokens can propose changes to smart contracts, put forward proposals, investment ideas, etc. and vote on them. The specific methods differ depending on the specific DAO, thereby promoting the development and growth of the DAO.

Based on the above five characteristics, the “labor” in the future meta-universe will be organized in innovative forms, such as digital content creation, game cashing, 3D modeling, IP transfer and other activities that can be accepted and delivered online. Can be achieved.

We believe that the so-called meta-universe immersion is not only a virtual world that can be seen with VR and AR glasses, but a digital world that can freely create, socialize, engage in labor and economic activities.

Posted by:CoinYuppie,Reprinted with attribution to:
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