We do not realize how powerful a structure the DAO is. This is something that we are only starting to experiment with. Over the next couple years, we will see this emerge as a major piece of the radical change society encounters.
DAOs are a great deal more than just tokenization. There are many level to it which can enhance the experience of all who are involved. Here is where we see an entire business structure forming.
It appears few have considered the DAO when starting a business. The key is going to be linking up real world projects with this concept. Here is where we see the ability to cryptocurrency in full force. Not only does it provide a new business model but also enables cryptocurrency to be used to increase productivity.
We see one that is serving as an example.
VinesDAO
Here we have a project that is combining wine tasting with cryptocurrency. The two have passionate following so it makes sense to put them together.
The main idea is that the wine business is exclusionary. It takes big money to open a winery. This also ignores the expertise that is required. This project seeks to provide a solution.
Before going any further, here is where we mention this is not financial advice. The information here is used solely as an example of what is possible.
That said, we have few details other than a Litepaper. Nevertheless, we can see how some of this is forming.
Basically, there are three levels which people can buy in. This will provide them with certain benefits as laid out in the paper. Each carries with it some type of governance although the higher levels get multiplied voting rights. It appears this is essentially a stake-weighted voting model.
The DAO is going to buy some grapes. From this, the investment is in real-time wine making. The goal is to include wine enthusiasts in the process while giving anyone the opportunity to become a vineyard owner. This is not a virtual game either.
Reading through the paper spells out what the $GRAPE token offers in terms of access with each level receiving more tokens. Ultimately, we are seeing a new funding mechanism coupled with governance and inclusion.
If you ever wanted to own a winery, here might be your chance. Visit their website to follow their development.
Regulators Will Hate It
One of the interesting things about this project is it used the word "community". This is the focus of these DAOs. People get together around a particular theme, thus becoming a community. We see them all over the place. However, as of now, they are basically just existing.
The DAO concept enables them to take thing much further. Not only can a community become tokenized, it can become participants in a business. This is a radical new idea.
As with most, the regulators are going to want to put a stop to this. They, after all, cannot allow free reign by the population. Hence, agencies like the SEC are going to want to classify this as a security. According to their old laws, it essentially is.
However, cryptocurrency is a global unfolding. Not every country is going to take a negative stance on these. At the same time, many will be established on truly decentralized platforms which is out of the reach of the regulators. Here is why it is so vital to have decentralized infrastructure in place. If the foundation is solid, there is a better chance of what is built on top is untouchable.
Of course, like most things, at the moment, this is low on the list of the regulators. For the most part, they are not aware of what is taking place. We see the evolution of where their focus is. While the SEC is still fighting Ripple over being a security, the industry is in the process of rolling out an entirely new business model.
Just think of the progression:
- ICOs
- Decentralized Finance (DeFi)
- Stablecoins
- NFTs
- DAOS
What is next?
Naturally, we cannot overlook the fact there is innovation taking place within each realm, altering the makeup of what is available.
Source
Are DAOs The Future?
We can see how these can be used for inclusion. While VinesDAO is rather limited, offering 10,010 positions, there is room for a lot more people. Perhaps this wine making realm is a rather limited one. It is obviously not as popular as, say, the Dallas Cowboys. So having lower units available at a higher price might make sense.
There is nothing that says a project cannot offer out tens of millions of tokens, at a few cents apiece. When putting something like this together on Ethereum, that is not possible due to the transaction fees. However, if transactions cost next to nothing, then one with even a few dollars could invest in something like this. Buying up a couple tokens could be a good thing.
The areas this can drift into is incredible. Consider how many communities there are and that we form as people. To think of this, ponder what applies to you. We have a gender and sexuality. Some are parents or kids. We have likes (hobbies). There are schools we attended. Certain things we are fans of. We live in particular areas. Our lives are full of experiences. Perhaps we are recovering from something. We invest in different things.
Basically, we can keep going for days. The point is each of these could be considered a community. Hence, each could be tokenized and many could form a DAO if there was some particular business venture. This is taking community participation to an entirely new level.
It is also a massive step beyond the idea of putting together NFTs for a community of fans (as an example). This is offering them legitimate investing options.
Can you see how big this can become? Imagine the idea of millions of these popping up all over the place. We are essentially building millions of small businesses, which are the heart of any economy.
So we can reasonably conclude that DAOs have a place in the future. It is a design that will evolve and grow. One of the most powerful things about cryptocurrency is the amount of innovation that takes place. When community members are tapped into, they can offer up ideas. At the same time, new projects can take what went before while adding new components.
We are in a period of massive experimentation. This is something that the world is really lacking.
DAO are an idea that is just beginning. We can frame this as we are looking at DAO 1.0. Over the next few years, another version will emerge, DAO 2.0. Imagine the potential when DAO 5.0 is available.
Once again, cryptocurrency is changing things in ways we never imagined. Fortunately, this is just getting started.
If you found this article informative, please give an upvote and rehive.
