21st Century Methods for Democracy

Clinamenic

Binary & Tweed
what is a smart contract?
Really its the part of crypto that I'm most excited about.

So a blockchain is just a history of transactions that exists in the memory of all the computers working in it, a history that can be accessed by anyone. Differences here and there across blockchains, but that is the premise: a ledger in which there is no central entity that everyone else has to trust is acting in their interest.

So lets say there are a million active addresses on a blockchain, which means each one is being used, lets say by one person each. Each person has one address associated with them, and each address as a balance associated with it.

When you "send" Bitcoin, you just submit a change to the ledger in which the balance associated with your wallet address changes, as does the balance associated with the wallet address of the recipient. Its just data shifting around, one massive sequence of 1's and 0's changing to another massive sequence of 1's and 0's. Every change included many transactions, so its not just one transaction per iteration.

Because this is all code, it can be algorithmically manipulated. Wallet balance is pure data, and we merely associate an abstract value with this data. Smart contracts are algorithms that can be written to automatically and rapidly change balance data in very complex and conditional ways.

If you make a bet with someone that it will rain where you live this time next week, and you write a smart contract that draws from weather data from sensors in your area, you no longer need to rely on your friend choosing to fulfill their financial obligation. If it rains, you receive the money.

edit: that is, balance of your address has increased and that of your friend's has decreased.
 

Clinamenic

Binary & Tweed
Now consider how elaborate and precise these automatically enforced agreements can get, provided reliable data. If satellite footage detects fire (edit: on a farm), via machine vision, and that data gets fed into insurance smart contracts; if a sensor on your car is constantly measuring your speed and its relation to the local speed limit, and feeds that data to your insurance provider; etc.
 
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Clinamenic

Binary & Tweed
An algorithmic fine-tuning of virtually every kind of financial agreement, as far as I can tell, which frees up the costs that have previously been incurred to enforce the kind of trust that is now automatically enforced.
 

Clinamenic

Binary & Tweed
If you make a bet with someone that it will rain where you live this time next week, and you write a smart contract that draws from weather data from sensors in your area, you no longer need to rely on your friend choosing to fulfill their financial obligation. If it rains, you receive the money.
Of course, we would be using a bet-making application developed by people who know how to write smart contracts, but perhaps someone will make an application with an intuitive experience that lets anyone create custom smart contracts.
 

Clinamenic

Binary & Tweed
Now consider how elaborate and precise these automatically enforced agreements can get, provided reliable data. If satellite footage detects fire (edit: on a farm), via machine vision, and that data gets fed into insurance smart contracts; if a sensor on your car is constantly measuring your speed and its relation to the local speed limit, and feeds that data to your insurance provider; etc.
It removes many of the costly assumptions and generalizations that are made when precise, situational data is either unavailable or its too laborious to take into account. Provided healthy competition, this savings won't just be enjoyed by the companies, but also by the customers/clients.
 

Clinamenic

Binary & Tweed
Just look at decentralized finance (DeFi), which is just a variety of apps that utilize smart contracts across various blockchains.

Synthetix, Aave, Compound, Curve, Uniswap, just some of the incumbent DeFi protocols out there.

Some of them already get mind-numbingly complex. Deposit 17.88 Xcoin in this interest-generating liquidity pool, and 17.88 Ycoin is generated as a redeemable synthetic asset which grows in accordance to your share of the liquidity pool. Redeem your Ycoin and it is erased, and you receive your Xcoin back with whatever interest it accrued.

Although technically its not interest, but yield, but I just needed to make a point and interest is a more established concept.
 

Clinamenic

Binary & Tweed
I'm pretty sure "flash loans" involve depositing some amount of crypto and immediately receiving some future yield on that asset, paid in some synthetic asset, while the deposited asset stays locked up long enough to fulfill said interest.
 

Clinamenic

Binary & Tweed
It's crazy. One downside is that the sheer complexity of this stuff will make it difficult for regulators to gauge the levels of risk being taken by whatever financial institutions venture into this space. Like your average financial tomfoolery, but on caffeine in a 24/7 global market.
 

Clinamenic

Binary & Tweed
So between Lobby3, PubDAO, Sapien Nation, CityDAO and maybe MakerDAO, I'm starting to get participants in the DAO ecosystem on board with the idea of a global republic of DAOs.

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It would sort of be a patchwork of self-sovereign on-chain communities. Each DAO would have an internal networking department, here called the DAO Ambassador Committee, but different DAOs may call it whatever they want. Additionally, DAOs would also elect a representative, or more than one depending on how this statecraft architecture pans out, to join the congress of the DAO ecosystem, here called the DAO Representative Plenum.
 

Clinamenic

Binary & Tweed
For reference, in Lobby3 I am slated to be on the Gnosis multi-sig, i.e. the treasury board, alongside Andrew Yang, his former presidential campaign manager, and three others. And I may also be getting a salaried position within PubDAO. The other DAOs I am only acquainted with.

This is shaping up to be an ad hoc lightning course on the implementation of otherwise quixotically ambitious ideas.
 

padraig (u.s.)

a monkey that will go ape
in same way that crypto is a financial system designed by devs

daos sounds like - or I mean, is - a political system designed by devs

with all the good and bad that implies

idk, I certainly see the benefits of decentralized autonomous decision-making, theoretically amplified by technology (cause it's not like the idea is something new - people have been practicing or trying to practice it in any variety of situations throughout literally the entire history of human culture)

but it's hard not see it winding up as a technocratic nightmare, yunno like crypto

I guess I'm curious if you (i.e. Stan) or anyone else has a succinct - relatively succinct at least - for why that won't be the case
 

Clinamenic

Binary & Tweed
in same way that crypto is a financial system designed by devs

daos sounds like - or I mean, is - a political system designed by devs

with all the good and bad that implies

idk, I certainly see the benefits of decentralized autonomous decision-making, theoretically amplified by technology (cause it's not like the idea is something new - people have been practicing or trying to practice it in any variety of situations throughout literally the entire history of human culture)

but it's hard not see it winding up as a technocratic nightmare, yunno like crypto

I guess I'm curious if you (i.e. Stan) or anyone else has a succinct - relatively succinct at least - for why that won't be the case
It's really a case by case thing, rather than having an overarching set of rules that each DAO operates according to, so its unlikely that every DAO will become a technocratic nightmare.

But its certainly possible for a given DAO to fall into this pattern. There are some governance designs where members assign their governance tokens to Delegates, other members who are more well informed and actually read through all the lengthy governance documents. So in principle its possible that these delegates can form a cartel and rush in some undemocratic proposal that secures their oligarchy, but I don't know of any such examples. Totally possible though.

Another facet here, which has actually been experimented with in non-blockchain voting situations, is quadratic voting. Instead of each governance token in your balance equaling one vote, the voting power drops off as a function of balance, e.g. 1 token = 1 vote, 5 tokens = 2 votes, 25 tokens = 3 votes. This can effectively weigh the voting process in favor of small-balance members, but it can also be vulnerable to "Sybil Attacks" whereby one person makes multiple wallets, and distributes their own governance tokens among these wallets to exploit this voting formula.
 

Clinamenic

Binary & Tweed
Crypto can be framed as a control-abetting nightmare and a control-evading nightmare just as easily, and there is truth in both. It has the potential to be totalitarian and the potential to be anarchic.
 

padraig (u.s.)

a monkey that will go ape
It's really a case by case thing, rather than having an overarching set of rules that each DAO operates according to, so its unlikely that every DAO will become a technocratic nightmare
thanks, that's a pretty reasonable answer

it's hard to for me to imagine these doing much of anything sans mass participation which I don't imagine is forthcoming - technocratic may have not been exactly the right word since it implies societal or national-level decision-making power that DAOs don't have - more like the various barriers to access - technological access and literacy, time, cultural capital, etc - make it seem very unlikely that the reach will expand much beyond an affluent, tech-literate demographic, i.e. the kind that usually forms a technocracy

but at least they won't, or shouldn't be, actively harmful like crypto

the idea the smart contracts are necessarily more optimal than human decision-making is something I'm skeptical of as well

there are still humans writing the code

it's turtles (or in this case, humans) all the way down, and tho they do have the - very significant, tbc - advantage of decentralization, they also the same steep barriers to access, especially when it comes to actually writing the code rather than merely using it, which seriously counteracts that decentralization

it's pretty much the same the story with every disruptive tech thing - it's not that the traditional industry (taxis, hotels, finance, whatever) is good, let alone flawless, but that doesn't mean that's what replacing it is necessarily an improvement. this is more general than DAOs tho, which in and of themselves don't seem like a terrible idea or anything, just ineffectual.
 

padraig (u.s.)

a monkey that will go ape
tho having said that, I wish you the best of luck with yours, even if it does sound (no offense) like basically an Andrew Yang think tank dressed up in tech speak
 

Clinamenic

Binary & Tweed
Yeah you're definitely right about the technical complexity and inaccessibility of DAOs. They're still pretty new. You need to have gotten over the learning curve of blockchain before you can even really start with DAOs, so the space does intrinsically favor those with the literacy, or time to develop the literacy, as you say.

The first DAO was only maybe seven or eight years ago, and it's only the last couple years that they've taken off and developers have started making tools for them. And really its only in this current wave that the corporate and legal world have been getting involved, which brings with it a cultural shift as you'd imagine.

Lobby3 is shaping up to be effectively just that, a think tank that sources documents and research to web3-related lobbying and advocacy groups. Yang is more of a figurehead at this stage, rather than a hands-on, operational participant.

One of the things that I think is good about this space is that your colleagues don't need to know as much about you demographic-wise. There is still the natural uneven representation, due to the technical barriers, but in large part you can't tell what someone's gender, age, race, etc. is just by looking at their textual screen presence. You can infer, and voice meetings bring some answers. But I really just joined a discord server and started compliantly assuming responsibilities.
 

Clinamenic

Binary & Tweed
being at the cutting edge of the think tank-lobbyist hustle doesn't seem like a bad place to be, career-wise
Although it is strange, dealing so closely with people who are chiefly motivated by wealth, despite already having plenty. I'm no ascetic myself, having a passive portfolio, but I don't see much potential for fulfillment there.

There are others in Lobby3, community members who are earning responsibilities alongside myself, who are motivated by utopian ideals of web3, and producing public goods, which personally I find to have much more potential for fulfillment.
 

padraig (u.s.)

a monkey that will go ape
The first DAO was only maybe seven or eight years ago, and it's only the last couple years that they've taken off and developers have started making tools for them. And really its only in this current wave that the corporate and legal world have been getting involved, which brings with it a cultural shift as you'd imagine.
I'm sure

I see above you speculate that devs will eventually start creating apps that allow people without any or with only minimal programming experience to start creating their own smart contracts, which sounds right - it's obviously what happened with websites via WordPress (which, amazingly, powers ~40% of sites on the Internet), Shopify, Wix etc. (or GUIs to replace the command line interface, or etc in the history of computing). tho I have to imagine, w/o knowing any of the technical specifics, that the hurdles are pretty high when it comes to creating an intuitive smart contract application.

also tho, mentioning the corporate and legal world, the same thing has happened with everything on the Internet - the digital frontier is, just like its physical predecessor, in an endless cycle of pushing outward into new wilderness which is "tamed" by the arrival of civilization (i.e. corporate etc influence) and so the restless press on again to new wilderness and so on - and just like every other iteration I would be very surprised if capital doesn't find ways to capture these new spaces just as, yunno, institutional investors wound up eventually owning massive amounts of crypto, we're going to get centralized digital currencies, etc. everything seems to be touted as the thing that will free us from the powers that be but I guess I'll believe it when I see it - as a wise lady said, the master's tools will never dismantle the master's house. physical space - colonization of other planets - would, barring some kind of FTL travel, do it (for better or worse), but digital space existing in the same physical space as always, I struggle to see. but maybe I'm wrong.
 
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