You're reading State of the DAOs, the high-signal low-noise newsletter for understanding DAOs.
gm and welcome to State of the DAOs!
Trust and legitimacy are two important features of DAO governance. Right now, most DAOs execute governance decisions by relying on the social layer, trusting that multis-sig signers will execute the decisions made by the community. Smart contracts are designed to function like real world legal agreements by automatically enforcing agreed-upon rules, but right now most of the data we need to make decisions isn’t onchain and accessible to those smart contracts.
This week, Hart Lambur shows us how UMA’s Optimistic Oracle is solving this problem by bringing real world data onchain. The Optimistic Oracle gives DAOs the ability to create onchain rulesets that are enforced by oracles, building trust into the social layer and paving the way forward to truly decentralized decision making.
Next, we take a look at the organization behind the Impact DAO study interviews that we have been featuring the past few months. ImpactDAOs is a decentralized, collaborative, and open-source project that has been conducting an intensive and systematic study of the leading ImpactDAOs. Soon they will be publishing their findings in a book, supplemented with articles, interview summaries, and podcasts with the DAO builders themselves. The release of their book marks the start of a larger initiative to continue providing information, wisdom, and insights for new web3 participants who want to get involved in the rapidly evolving work of Impact DAOs.
Finally, we share the TL;DR on some of the best DAO ecosystem takes and thought pieces, making it easy for you to cut through the noise and learn everything you need to know about the current state of the DAOs.
Contributors: BanklessDAO Writers Guild (Hart Lambur, Seneca52, angelspeaks, Austin Foss, Lanksss, Quilia, Warrior, Jake and Stake, hirokennelly, siddhearta)
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By Hart Lambur
DAOs offer a new and accessible form of coordination on a global scale. Yet, many still consider the DAO construct intrinsically inefficient, “broken and need(ing) fixing”. One of the reasons coordination failures take place is that it is easier to default to trusting human consensus rather than blockchain consensus.
We saw how human consensus failed when the vote to reimburse Fei Protocol users was vetoed by the protocol’s founders. Months before, the Solend community voted on a proposal that invalidated a previously agreed upon proposal.
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