Since my article on Countries versus DAOs was very well received (thank you all for your support, by the way) I decided to do a follow-up, this time about a real DAO.
I already wrote about the FOX token before, when they launched, but since then things has changed and the DAO evolved dramatically. But in a good way.
ShapeShift, The Decentralized Exchange
ShapeShift was one of the first decentralized exchanges in the crypto space, allowing trading of native assets without KYC (and without an order book, instantly). What Thorchain does these days, they were doing a few years ago. If you ever used MetaMask to swap some tokens, you used ShapeShift. The "problem" was that the platform was closed sourced, it was private.
A few months ago, the stakeholders decided to ditch that, and migrate the private entity behind ShapeShift, into a DAO. This move includes, among other things, the open sourcing of the code and the release of a DAO token, FOX. To distribute the token, they did an airdrop, and that's what I was writing about, when I wrote about FOX.
The airdrop is gone now, and the DAO is in full action.
Governance And Activities
All activity in the DAO is conducted via proposals and voting. They used a platform called Baordroom, built on top of Ethereum, which is like a DAO management tool. You can have a look at their current proposal list here. In many ways, this is similar with what HIVE DAO does. Proposals range from the launch of a FOX-based stablecoin (which didn't pass first time, but passed recently, on re-run), up until appointing members for various tasks or creating and distributing merchandise (something I would like to see on the HIVE DAO as well, to be honest, I'd wear a teeshirt saying "HIVE OG").
Projects And Use Cases
One of the first use case of the FOX token was pooling and staking it inside the ShapeShift ecosistem, to provide liquidity. There were two incentivized programs, with very good APRs, the first one ended, the second is under way, and it will end at the beginning of next year. It's important to mention that the second program was implemented at the request of the DAO members.
Other use cases for the token are LP-ing in various other DeFi projects. The latest two projects in which FOX is involved are Tokemak and Ichi. I will briefly try to describe both, keeping in mind that there were a few others before that, like participation in the Olympus bond program.
Tokemak Reactor
Tokemak is a new DeFi project, which tries to avoid "mercenaries" in liquidity pools, and replace them with "missionaries". In short, this is happening by pooling and staking one type of asset, paired with TOKE, the platform token, and getting rewards in TOKE. I won't go into details about the mechanics, this is not the topic of the article, feel free to visit the Tokemak Medium blog for details.
Suffice to say that the first reactors accepted in the Tokemak ecosystem were 1Billion+ projects. ShapeShift DAO has roughly $110 million market cap now. And yet, the community mobilized very fast, they pooled their votes and gained a well deserved spot in there. It's a very good example for the flexibility, rapidity and efficiency of a DAO.
Ichi - Stablecoins
The second project is Ichi, a platform where you can mint stablecoins. Again, the community gathered together very fast and they decided on a 80/20 minting model. Meaning you spend $.80 worth of USDC and $0.20 worth of FOX, to get back a oneFox token, which is the stablecoin of the ecosystem. Again, for details about the Ichi platform, you can go here.
Potential Downsides
As I am getting to the end of this short introduction, I want to point out a couple of inconveniences (yes, there are always inconveniences, the idea is to asses if we're will to accept them or not).
First of all, the platform is still built on Ethereum (FOX is an ERC20 token), which means insanely high fees. It's probably not worth entering if you're not having at least 1-2 ETH put aside for liquidity mining, and a little bit of change for the fees.
Second, the community is still very, very young. The price action has been very favorable so far, and the entire DAO was launched during a bull run. But it's hard to tell how many of the initial members will survive during the next bear market.
TLDR
Please keep in mind this is just an introduction and there are many other things to be learned about this community. I encourage you to visit the resources linked in this post for more details. Until then, here is a short recap:
What Is ShapeShift?
ShapeShift is a DAO built around a native exchange platform, with 750+ cryptocurrencies supported across 11 blockchains.
What Is FOX?
FOX is the governance token of the DAO.
Where Can I Find More Info?
Here's the link for the beta version of the DAO: ShapeShift
Image courtesy of the branding catalog of ShapeShift DAO.