Created

Jan 19, 2023 8:01 PM

THOUGHT THURSDAY

Bankless Writer: David Hoffman, Co-Founder of Bankless

The Future of Work

Where there is value, there is opportunity, and where there is opportunity, there is demand for labor to help capture that opportunity.

The magnitude of opportunity found inside of the crypto industry dwarfs everything else in the world. Therefore, there is also an insane demand for talent and labor, unlike anywhere else.

The massive expansion of value and capital in this industry over the last 12 years has outpaced what the people of this Earth can keep up with. Not everyone can uproot their lives and dive into a young, high-risk, high-volatility industry. At large, global populations take years or decades to slowly pivot towards solutions for a labor glut. Even traditional, meat-space instantiated companies like Coinbase can’t even capture the entirety of this opportunity, because this opportunity is inherently internet-native.

Only internet-native organizations can fully access the opportunity brought by an internet-native revolution in money and finance. As the total value of crypto-wealth grows, the demand for crypto-labor follows.

This crypto-labor is going to be serviced by Digital Organizations.

Digital Organizations Are The Future

The future of work belongs to Digital Organizations. Colloquially, we call these DAOs, but that is not the right label for what are actually Digital Organizations.

The OG concept of a DAO, a Decentralized Autonomous Organization, is code at the center, and humans at the periphery. A DAO is a smart-contract or system of smart-contracts on Ethereum that are autonomous because they have no human dependencies; they operate as autonomous software on Ethereum. Uniswap, AMM’s, and RAI are good examples fit the original definition of what a DAO was.

DAO’s were theorized to eventually become increasingly complex:

“What if we could just turn Uber into a smart contract, and all the Uber drivers would work for the DAO, and be able to keep a larger share of their profits??”

Comments like this were commonly found in the early days of Ethereum, from 2015-2017, before most people had to grapple with the immense complexity of changing the state of meat-space using Ethereum, which is exclusively a virtual state machine.

The OG version of a DAO is a land of infinite possibilities, and I predict that these meat-space-changing autonomous systems are where Ethereum ultimately arrives in 2040+, once Ethereum’s ability to organize humanity has matured to be more effective than Nation-State and jurisdictional organizational schemas.

We’ll revisit DAOs in a few decades, but now is not the time for DAOs.

Now, it’s time for DOs.

Digital Organizations are the next frontier of Ethereum and the future of work.

WoW Guilds and raids, or any other MMORPG group, should already feel familiar with Digital Organizations, especially when considering World of Warcraft as an economic landscape filled with scarce treasure and resources.

Digital Organizations are compositions of humans without geographic constraints. Largely hosted in Discord servers (but not exclusively!), DOs are collections of like-minded people with like-minded goals, that work together to make progress towards those goals.

DOs tend to form organically, where those most resonant with the goals and aspirations of the org increasingly gravitate to the Discord server and community.

And now, with Ethereum, DO’s have access to a new tool that changes DOs from communities of intrinsically motivated communities to financially motivated organizations.

That tool is the token.

Tokens power communities.

Tokens are the thing that turns passive Discord channels into active ones. Tokens are the fuel that DAO laborers consume in order to output value for the org. They provide and catalyze the motivational energy for the DO to do.

The token represents the reservoir to which DO community members can deposit their time and labor into. Members of the DO inherently want the DO’s token; if they don’t want the token, then they probably wouldn’t be in the DO’s Discord server. The desire to own a larger share of the DO is what injects labor into the DO, and helps make it become a valuable thing to own in the first place.

The DO, as the controlling entity of its own token, has the power to mint/issue/award tokens to the members that labor for the DO, and if there is a sufficient supply of interested labor willing to work for DO tokens, then the DO has the available potential energy to progress towards its desired goals.

DOs (Bankless DAO still calls itself a DAO) are their own Leviathan. The shared goals and culture form the organization, and token rewards are the incentive to keep the organization cohered and progressing towards their shared goals.

In Thomas Hobbes Leviathan, he claims that Nations compose themselves with force. Threats of jail or bodily harm is why you don’t steal, why you pay taxes, and why you drive on the right side of the road.

DO’s have no such power; they compose themselves by the power of postive incentives, and incentives alone. I’ve poorly photoshopped out the sword out of the hand of the Bankless DAO Leviathan, because it doesn’t have one. In lieu of violence, Bankless DAO provides BANK for participants, and all DAO members are in the org by opt-in incentives alone.

Instantiating Purpose and Goals

Tokens are the instantiation of shared purpose and shared goals. Each DO grows its own social contract and its own culture, and it revels in these things as it works towards building a future that the DO wants to see for itself. The token becomes a totem of the community as the representative symbol of everything the DO stands for.

It becomes the banner which the DO’s army stands behind.

This allows people who resonate with the collective goals and purpose of the DO to work for something that they intrinsically believe in, enabling people to work for a calling, not just a job or career.

Above, I said: if there is a sufficient supply of interested labor willing to work for DO tokens, then the DO has the available potential energy to progress towards its desired goals.

Whether or not a DO has the available potential energy to achieve its goals is highly correlated with what that DO has set out to achieve.

“Even a billion dollars of capital cannot compete with a project having a soul.”Vitalik, Endnotes on 2020: Crypto and Beyond

Having a soul is to have purpose and meaning in the world. Unlike any organizational structure ever before, DO’s have the power to coalesce people all over the world under common goals and aspirations, that are based in intrinsic desires rather than extrinsic profit motives.

One of the core components of the Ultra Sound Money model, and Eric Wall’s Proof of Stake is Less Wasteful article, is that Proof of Stake is the optimal form of crypto economic security is because it organically selects those who are most bullish to provide security. ETH bulls are willing to accept the least amount of token issuance, in order to provide ample amounts of stake to the system. Those most aligned with Ethereum do the most work for it, for the least cost.

This same effect happens with DOs. People join DOs because they are intrinsically aligned with the goals, aspirations, and culture of the DO. These people find themselves wanting to contribute, rather than being compelled to contribute. These people will work for the DO for the least cost, because they intrinsically believe in what they are doing, and they also want the DO tokens more than anyone else.

DOs are strictly opt-in systems, and the only people providing labor to the DO are the people that intrinsically want to be there.

Imagine, for example, a young DO with a brand new token that has low-to-no market cap and very little liquidity in its token. This DO wants to build a relatively ambitious website. The DO can either:

Find a website agency
Source talent from inside the DO

Because the DO is brand new, it doesn’t have any capital. It only has its own token, which is low market cap and low liquidity. Imagine how difficult it would be to convince a 3rd party website agency to build a website for the DO, while accepting compensation in the DO’s illiquid token.

If the website agency isn’t intrinsically interested in exposure to upside of the DO, it’s going to be a hard sell, and they’re likely going to want an outsized amount of DO tokens to offset the risk of providing labor for an organization that may not work out.

On the other hand, if the DO is working towards something that people intrinsically believe in, the people interested in seeing that vision achieved will naturally find themselves gravitating towards the DO, and are also willing to help the DO get what it wants. They might work for the DO for free, in order to win social capital (aka Kudos) from the other DO members and rise the ranks of DO social clout. Maybe they’re also willing to gamble that the DO will award them tokens for their labor in the future, and by showing their commitments to the DO, they will be in a good position to receive future compensation.

Maybe these incentives land with enough talented web developers and project managers that the DO can get its website built from this talent pool.

DOs are vehicles for accessing labor from talent that is aligned with the vision and ethos of the DO, and represents a vehicle for building organizations that are highly aligned with human values.

DOs have the capacity to generate a shared vision of the future in its members. The more that that vision is Good, as defined by the people of the world, the more talent and labor that DO is able to attract. Some human values and cultures are more ubiquitous and salient than others, and DOs that can align with these strong human values have the power to tap into a lot of aligned labor interested in proliferating these values.

DOs are vehicles for building progressive organizations that are fundamentally aligned with human values, and what we want to see the world become.

Bullish on Humanity 🚀

New Limits to Scale

Internet-native organizations have the ability to align incentives at an internet-scale. However, we can already see the cracks in Web2 apps like Twitter, Facebook, and Google products. These legacy corps suffer from a fundamental misalignment of incentives among the different parties that use their services.

Web2 social networks started off as paradigm-shifting platforms that allowed humans from all over the world to come together and share experiences in culture.

And then, the companies that owned these platforms turned from growth to extraction, as shareholder incentives take over. If the platform is free, you’re the product.

This is Facebook causing civil wars in far-off countries by selling eyeballs to the highest bidders. This is Twitter de-platforming a president (for better or worse). This is all of the Web2 companies having equity trading on U.S. domiciled exchanges, while the equity of the company governs a globally scaled social platform, essentially becoming an appendage of American Imperialism.

Nic Carter, in his article Your Property Rights Should Extend to Social Media, argues the case for “Squatters Rights” over social media accounts.

Nic argues that:

It’s the users of these Web 2 platforms that create the value.
According to each Web 2 platform’s “Bill of Rights” (ToC’s), users do not own the property that they settle on (Twitter handles, YouTube accounts, Facebook pages).
Web 2 platforms have unregulated and misaligned governance practices over the real estate where their users settle.
Users are likely to migrate to more ‘politically stable’ platforms in which their property rights as account-owners have stronger assurances.

Select excerpts:

Facebook, Twitter, et al, did not really create all the content on their platforms, nor do they really own it. Instead, they define a namespace that users occupy, build upon, and in some cases commercialize. The users, not the administrators, create the vast majority of the value, and as such are the rightful owners of their digital property. …squatters asserting their property rights against an authority that lays a blanket claim to them would be nothing new. That’s the legal struggle that defined the history of the American continent. Initially, large tracts of land were claimed primarily by the states and absentee landowners. Over time, squatters were able to argue persuasively they had put sufficient labor into their homesteads to legally ratify their informal claims“…it’s clear the current largest internet platforms are taking an unsustainable approach to digital governance.”We can expect that if the major platforms continue to operate as unaccountable fiefdoms, users will gravitate towards systems that are more politically stable, those that enumerate and define the rights of users (rather than just listing, Ten Commandments-style, various bannable offenses), and enshrine genuine protections of property.

This is why we need organizations that are built by users, and why it’s particularly revolutionary that DOs are formed by individuals coming together under a shared goal of producing something that the group wants collectively.

This bottom-up organization allows for the bottom to dictate the direction of the platform. Because DOs are comprised of individuals who opt-in, rather than VC-funded leadership, the resulting product is aligned with the vision of the collective rather than the entrepreneurialism of a few select visionaries.

Eventually, DOs will be able to fulfill similar niches that Web2 platforms currently fill. However, these solutions will be user-built, user-governed, and user-directed. They will have a DO token that ensures that those stewarding the DO are aligned with the org, and the token will both fund progress and capture energy from the system in order to sustain itself.

By the very nature of their organization, DOs will be constructed in such a way that enables their uses to achieve success, rather than extract capital from their users on behalf of the shareholders. At maturity, DOs should be platforms and organizations that assist humanity, rather than extract from it.

Because the DO is building a product that is fundamentally aligned with its users, the product will come to enable its users, as technology should! Technology is just a bicycle for the mind, after all.

It should assist us in moving towards our individual and collective goals.

Changing Work Culture

Discord and Slack have a ton of similarities. They’re basically group coordination software that allows work streams to stay focused and organized, enabling asynchronous coordination between people. You don’t have to be perpetually present; things can progress without you being there, and you can tune into them as you’re ready to, and get caught up to speed.

Different Slack/Discord channels are spun up for different work streams, and the fluidity of movement between channels allows for work streams to come together as needed, in case there is a product being made that combines separate work-teams.

But the main difference between Discord and Slack is that Discord is more open. Discord is just inside-out Slack. There’s something about the culture of Discord that promotes openness and access. Slack culture is very much top-down. It’s very corporate. Discord culture is very bottom-up. It’s emergent.

Here’s the state of the BanklessDAO discord, just 1 week after birth:

For younger generations, Crypto Culture is product market fit. For the internet natives, Discord DO’s are blurring the line between labor and play. Work is occurring in the same places people recreate. Everyone is proximate to both progress and relaxation.

DO members are leading the WFH lifestyle, where not only do they not have offices, but they also don’t have 9-to-5 labor hours. Like the 24/7 crypto-markets, DAOs are perpetually in a state of ‘On’, but the working members are fluidly turning themselves on and off as it fits inside of their lifestyle. In the legacy world, you prioritize work before life, and you mold your life so that you can hold a job and work.

In DOs, lifestyle determines labor, rather than labor determining lifestyle.

DO’s are going to offer an experiment in both establishing a new paradigm in work culture, and also an exploration into what it means to be productive. It’s common knowledge that anyone in a corporate, 9-5, office-job works for about 2-3 hours per day, and then spends 5 hours being “busy”, waiting for 5pm to strike so they can go home.

The crypto industry has a habit of stripping away the BS from things, in order to get right down to the essence of the matter. People who work for DOs are already home, so there’s no such thing as idle hands under work-hours. There aren’t any hours ¯\_(ツ)_/¯. DO’s find creative and innovative ways to compensate for output rather than regular hours.

This is the work-life culture that Millenials and Zoomers dream of. Working in the comfort of one’s own home, online, and no-or-little top-down authority ensuring active labor. Compensation on contributions, with minimal commitments.

Not only do the legacy institutions of the world have to compete with the permissionless labor-monetization tools offered by Ethereum, but they also have to compete with the lifestyle that these tools offer: the freedom to work for oneself.

Fluid Work

Unlike typical employment, DO’s don’t make you sign employment contracts and become exclusively committed to them. DO members are free to fluidly move between DOs, contributing their skills wherever they fit.

Rather than rigid, vertical corporate structures, DO work could resemble a flat mesh network of organizations. Interestingly, it’s likely that many DOs will share a significant amount of the same members, as the people who are good at DOing will likely find themselves working for multiple DOs.

If you are a young person, looking for purpose, meaning, and eventually a salary, establishing yourself as a strong DOer is one of the best footholds you can establish for yourself. DOs are so new, and are in need of leadership. That can be you, and you can make a name for yourself by rising the ranks of DOs by being a good DOer. If you believe DOs are the future, you should start DOing now, so that you become the scarce resource for both DOs and people who need help DOing.

The Future of Work in an AI world

One of my pre-crypto fascinations was the coming AI-driven world, which was largely informed by these two books:

Life 3.0 - Max Tegmark

Both books largely come to similar conclusions with regards to the relationship between AI, humans, and labor.

Tl;DR:

The point of technology is to reduce the need for human labor. Progressing as a society is we find ways to automate all the stuff that we don’t want to do, that we need to do anyways or else we die.
Taking this to its logical conclusion, humans are going to produce generalized AI, and that AI can truly do every single task we ever need to, in order to survive.
This is utopic, because we have robots doing all our work!
But it’s way more dystopic, because economically, a high percentage of the population won’t be able to fund their own life because there is no work left.

In this world, we will need to recreate the market for specifically human labor, and that’s what DOs can do for us. DO’s have the opportunity to redirect this dystopic future into a more positive one, by capturing the supply of available human capital and directing it into cultural outputs.

The whole point of existing in this world is to produce culture, and the elimination of low-value work (burger flipping etc) can be a boon to cultural creation.

There are going to be some things/products/services that humans are going to specifically want from other humans. These products and services are going to be immune from advancements in AI, because these products are going to be produced by humans because other humans demand them to be human-produced. I believe that DOs are largely going to be cultural generation facilities, and DO competition will ultimately converge upon which DO can create the best culture for its contributors, creators, members, and consumers?

MetaFactory has this figured out. MetaFactory is leading the way into expressing crypto-culture via merch and has its finger on the pulse about the value of cultural expression.

Bankless DAO is also a culture DO, focusing on establishing and perpetuating Bankless Culture throughout the world.

Culture-as-a-product can only be made by humans, to be consumed by humans. The future of work will be focused on cultural creation, and it will be funded by an insatiable desire to purchase culture. DO and Do work can be a sanctuary for human capital, immune from the advances of cultureless AI.

You may think: “Apparel? NFTs? Blogs? AI can produce all that stuff? They can produce culture just as well as humans can! The whole point of AI is their outputs are indistinguishable from human outputs.” And this is a good critique.

But there are already signs of people wanting products in the world that are made by humans, even when the robot-created version is equally as good. Hand-made goods always go for a premium. People simply pay more for human labor, and over time I expect DOs to focus in on products that humans want to be produced by other humans.

Conclusion

We are about to embark upon a great crusade! DO’s will help us do more than ever before! There is great potential in the vision articulated above, if it ever comes to fruition.

It may not.

Maybe DOs just don’t have what it takes. Maybe it’s too ambitious to hope for emergently organizing systems without top-down control.

But if it does happen, it’s going to happen because people are going to help others figure out what it means to DO. What does it mean to be a good DOer? What work and labor do DOs need the most? How can DOs fairly compensate people, when rent needs to be paid and families need to be taken care of? How do we ensure different parts of different DOs are fairly, but differently, compensated?

We need to find the answers to these questions, and these answers are going to come from collaborative experiments. Like with all things, it’s going to be an iterative process of discovering what works and what doesn’t.

If you want to participate in, or even just observe, these experiments playing out in real time, you need to be a part of Bankless DAO.

Bankless DAO is bootstrapping itself from a relatively blank-slate into a self-sustaining organization with self-selected goals and aspirations, and self-oriented directions to achieve those goals. It’s truly an experiment like none-other in the space, and if it works out, it can a model for many more DOs to follow.

If the goals and values of Bankless DAO aren’t for you, then don’t worry. Eventually there will be a DO for everyone! It’s just a matter of time until anyone with any particular interests has a relevant DO to align with, just like how there’s a subreddit for every hobby or a Facebook group for every interest.

We’re on the frontier of DOing.

Just DO it.

Action steps

Explore the future of work with Digital Organizations
Join the Bankless DAO!

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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

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