Two heads they say, are better than one. Conversely we can also say that three heads are better than two, four better than three and so on. But we must not fail to realize the underlying assumptions in these cliché which is that these heads be it two, three or four must all have a common interest or shared goal to be better. Ceteris Paribus, the statement remains true unless one of the heads is bad😏 and that's the reason it is preferable to say two good heads.
While still having a common goal, these "heads" must collaborate to make a decision on what the next course of action would be to achieve these goals. It would be valid to say this is the basic concept from which organizations and corporations which can be defined as a group of heads bonded together as a single legal entity by a legal document driven by a common goal, were formed.
In the course of action to reach these goals, funds(shared capital) are usually accumulated and devoted towards achieving these goals and the risk shared too by shareholders and the management, permit me to say the decision-makers. In all of these, regardless of the level of human association, from courtship to the nuclear family level down to big corporations and organizations, Communication is Paramount.
The importance of communication and value transactions cannot be overemphasized in human relationships and associations, in all levels previously mentioned. No wonder Sir Adrian Cadbury said,
... the foundation of any structure of corporate governance is disclosure, openness is the basis of public confidence in the corporate system and funds will flow into centers of economic activity that inspires trust.
The reason being that although members of a corporation have a common interest or shared goals, there might be approach variations regarding the course of action or variations in factors considered or even in payback period (value return) expectancies.
These differences would results to conflicts if each member of any level of human association does not have the opportunity to communicate or share these varying perceptions and at worst, heads will roll!😂. In essence, it would be valid to say that a corporation is only as large as its scale of communication and value transactions.
While the birth of the internet solved the menacing problem of communication by progressively transforming the world into a global village, it almost did not pay any attention to securing, scaling this relatively easy means of communication provided and left the problems of value transactions hanging. Cyber attacks in the form of spoofing have been rampant, server downtimes as well. These all clearly point to the inefficiencies of the internet to run organizations on. The internet revolution - the Blockchain - stands to correct this!😏
Blockchain 101
A blockchain is ledger of transactions linked together by timestamps. It derives its name from the fact that each transaction after being verified by a consensus algorithm is called a block which is linked or "chained" to other existing verified transactions (blocks). The consensus algorithm confirms a value transaction and it is run by several computers(known as nodes) on the blockchain network.
It is important to note that it is called a consensus algorithm because not until all computers arrive at the same computational result(a consensus), no new block is added. When the several computers responsible for data storing and processing are considered, it becomes obvious why the attribute "decentralized" is used with it.
The Blockchain births Decentralized Autonomous Organizations (DAOs)
Organizations as they grew, out of the need to coordinate the activities of its members in value transactions, communications and decision-making in whatever form, commenced the search of technologies that would help cater for these "needs". The search led to the conception of DAOs. Well, Dapps before DAOs. DAOs are innovative because it fades away the limitedness of Dapps.
DAOs and Dapps inherit the "centerlessness" of the blockchain. DAOs having similar attributes of no central point of control or failure, it eliminates the need for central internal management by coordinating the activities of members or agents in the organization through incentives and blockchain governance systems deployed through codes.
These corporations execute actions through verified rules on the blockchain known as smart contracts. These rules are upgradable but only through the rules themselves. You would not be wrong to add a smart or crypto prefix to these new generation organizations or companies i.e Crypto-companies or smart organizations.
The Wordpress for DAOs : DAOstack
DAOstack is an ecosystem that provides a layer of tools required for the creation, operation and governance of DAOs. It has been dubbed "Wordpress for DAOs" because it does for the blockchain what Wordpress does for the internet. The DAOstack ecosystem comprises of a crowd of interoperable DAOs which are made up of smart contracts deployed through one of the foundational tools called Arc (a solidity smart-contract framework). The ecosystem is powered by GEN tokens and based on the ethereum blockchain, temporarily though, before it is upgraded to become blockchain agnostic (integrable to any blockchain).
ImageSource : DAOstack whitepaper
The structure of DAOstack ecosystem can be visualized as a truncated tree with just the trunk and fibrous roots left, placed vertically upside down. The trunk represents the layers of foundational tools such as Alchemy, Arc.js, Arc, ArcHives and the fibrous roots represents the interoperable DAOs in the DAOstack ecosystem as roots of a tree share absorbed nutrients from the soil to maximize the tree growth, so does the interoperability helps maximize the benefits of open and distributed collaboration, hence growth of the ecosystem.
The Alchemy and Arc.js layers allow anyone to make an entry into the ecosystem even without any knowledge of the solidity code and ethereum blockchain. These layer actually saves cost of entry and time as well, speeding up the rate at which the ecosystem will be adopted.
The Arc layer which is the basis operating layer is built in modules(blocks) and upgradable. An implication of this is that it allows the ecosystem to evolve with time and meet with the needs of a dynamic market. On this layer there are connections between deployed modules, that allow for interactions between blocks of modules. This will allow smart organizations to be able to interact and collaborate seamlessly at the network mesh level.
The Alpha version is out already on the Ethereum mainnet and the thriving ecosystem has been made mention of in the media by investopedia, Forbes, Yahoo!, Techworm e.t.c.
But how does all this improve corporate or organization governance?🤔
Bringing corporate governance to the blockchain improves its transparency because information stored in the blockchain is not only visible for all on the blockchain to see, it is also unalterable.
There is an inverse relationship between a corporation's transparency and corruptibility. While traditional organizations might have been opaque and gave room for corrupt practices, smart organizations through the blockchain governances and the reputational voting system, improves her transparency and grossly reduces corruptibility. Best behaviors and best decisions are rewarded in this ecosystem.
Traditional corporation are usually headed by executives who are usually the decision makers or rather the individuals who tweak already made decisions by the board of directors. Therefore we could say that there is a level of uncertainty associated with passed proposals by the voting rights of the board. Meanwhile the final decision is flawed by so many factors of circumstances the executives find themselves mostly associated with the human emotions.
Decentralized Autonomous Organizations created with the DAOstack tools eliminates this flaw and uncertainty as predefined rules or parameters have been set to execute when satisfied. To make sure these proposals actually get enough considerations and also to avoid decision mismatches, protocols such as the attention funnel and holographic consensus have been embedded in the self-governing collaborative intelligence.
Recall that the DAOstack ecosystem provides layers of foundational tools which allows different distinct demographics to make an entry into the ecosystem either by creation and deployment of DAOs or collaborating with the already existing ones. By this, the stack tools eliminates the cost of hiring external blockchain developers or solidity experts. The ecosystem also provides an "app store" to purchase tested governances to reduce costs of building a new one, increase speed of setting up a complete agency and cuts down coordination costs a whole.
Finally, the importance of the modularity, interoperability, generality, upgradability, simplicity and openness of the DAOstack ecosystem cannot be sidetracked because these are the attributes brings flexibility, security and expansion of the ecosystem that will attract developers and pre-existing traditional organizations to it and ultimately expand the GEN economy, making available more than two good heads!😁
The importance of human association coordination can be visualized when likened to a drum of water. Inside the drum, all molecules of water move in a disoriented order, hence no much mechanical energy can be obtained from it. But when an outlet at the bottom of the drum is opened, all the molecules are self-governed by gravity, almost aligned in the direction of the opened outlet, bursting out of the drum outlet, making available more convertible mechanical energy. In the same way, self-governed collaborative human interactions would the synergy required to drive the development of the present economy and present technologies, especially when contributors are rewarded!😁
DAOstack Team
The DAOstack is the critical element needed for deploying DAOs which are more efficient and resilient organizations and this ecosystem which comes with innovative tools has been efficiently designed by these blockchain experts in the beehive photo album below
Clicking on each of the images on the website would pop-up each of their specializations and names.
Check out this DAOstack intro video;
More Information Channels...
- DAOstack website
- DAOstack whitepaper
- DAOstack Telegram
- DAOstack Twitter
- DAOstack Reddit
- DAOstack GitHub
- DAOstack Medium
- DAOstack YouTube
My Entry for Originalworks Contest
daostack2018.
Thanks for Reading;
CED.