How Bankless DAO might fail

I spent a bit of time today thinking about how this might go wrong. I can see a few obvious failure modes. These are not mutually exclusive and certainly not exhaustive. I’d bet we could come up with many more together.

Trap 1, Breadcrumbs from the elites’ table: Power remains centralized, participation is stymied as lower-status participants lose interest in participating in a system without incentives.

Trap 2, Narrowed mission: The DAO’s mission is narrowed to something achievable for the current core group, but too narrow to be truly relevant in achieving One Billion Bankless.

Trap 3, FOMO: Status-seeking creates a frenzied environment early in DAO formation as people strive to gain recognition and nominations to inner circles, recognizing the brief window in which power is consolidating. Rapid-fire, highly visible contribution is incentivized over deeper work on critical problems for which there are no easy solutions.
Just a guess here - I think this environment will likely produce structures similar to those in traditional organizations because these are familiar and easiest to reproduce (I’m failing to remember the awesome word RSA and David have used that describes this perfectly, when early generations of new tech resemble old tech… Help)

Trap 4, Too much founder involvement: Founders react to chaos, providing strong direction but too much dependency on their own abilities. Unless the founders are 9th dimensional chess players or characters in Tenet, it is probable that they will limit the potential of the DAO proportional to the level of control they exert.

Trap 5, Too little founder involvement: Founders provide too little direction when and where needed, the cats stay unherded, and the DAO flounders after people lose interest once formation energy wears off without traction.

Trap 6, Placing the cart before the horse: The DAO tackles too much, too fast. Even if the perfect projects projects are launched, by failing to work out the fundamentals such as DAO governance at both the social and the computation layers, the projects spin out or spin off due to an underdeveloped DAO being unable to provide the needed support.

Trap 7, eggs in the wrong basket: The DAO ties itself to one chain or project which fails, bringing the DAO down with it. This is a non-zero risk even with Ethereum, though I think it is far more likely to happen with a newer DeFi protocol

I’m done for now. I really do think it’s worth considering how a plan will most likely go off the rails before aping in. Ethereum wasn’t built in a day. It was the slow pace guarded by the core devs and founders that allowed it to become what it is today, despite all the screaming for faster pace from the sidelines. This discussion can be a kind of security audit of our social governance layer.

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How can you fail the vision of Bankless? you can have more or less success but the DAO can remain.
If there are people who believes in it, then it doesn’t fail. You just try.

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The risk I see is that the soul, the ethos, of Bankless could be lost or stolen as we scale up and it will exist in name only. Our architecture needs to prevent that from happening and we need to be very mindful of this early on. The trajectory we set now is vital.

We proceed today on the assumption that our power to vote will allow us to keep everything pointed in the direction of what “we all understand” to be “Bankless”. Bankless is deeply principled. There’s a surface of it that says we like crypto and we want to disintermediate the banks. In a direct flat democracy Bankless means whatever the voters say it means this week. Our scaling process is a double edged sword. The organization doesn’t necessarily keep it’s principles as it grows more powerful. It has to be carefully designed to do so. I wish I had more time to dive in. I really need to quit the day job.

Having principled whales during the formative years of the DAO and making an albeit imperfect attempt to capture like minded individuals in the initial distribution of voting rights makes a lot of sense.

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There are some good points here. Evaluation of potential weaknesses (even if risk is deemed minimal) is important. How to best decide on the levels of risk and possible impact on the DAO, that would be up for debate.

Overall, I am really impressed by the key contributors and community ideas brought forth in the early stages of this project. Incredible work.

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I totally agree about the trajectory we set now being vital. And about needing to quit the day job haha. Minor course corrections will not be difficult. A u-turn after it’s at speed will be very painful.

It seems like the most powerful tools this DAO has in reaching One Billion Bankless are memes and content to accompany memes. How long would it take for a billion people to be influenced by a meme vs other media? Meme speed is staggering. If we tool this thing up as a meme factory and successfully decentralize the effort while keeping the messaging on point, it’s going to make a BIG splash. Most other activities would need to be measured against the relative impact compared to memes to justify effort.

Not everyone is a meme master though and we have a ton of members, so it seems like there are other activities that could happen too in the direction of the mission.

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The message of Bankless is powerful and many people would share it. So we just need to reach out.

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I think these points are fair and cannot be just swept under the rug, but I don’t think the DAO can fail. There may be so much going on and way too many projects going on, but I think that shows the strength in conviction of this DAO and the dedication to it. The cream always rises to the top, so these ‘lesser prioritized’ proposals or not so good ideas will eventually fall off the wagon. But there are so many people here with such great ideas and such great support trying to make this better, while essentially receiving zero profit right now. I think that speaks volumes. I understand what you’re saying and it’s always important to think of ‘the other side’ but I will take the constant ingenuity, effort, and dedication of the BanklessDAO members to succeed all day, every day.

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As long as there are always people to contribute, the DAO stands. I do believe those traps are relevant, and that they’ll pose a problem. We can acknowledge them and steer away from them as best we can. If we’re all aiming towards the same goals, and I’m sure people will fall astray, we can help this bad boy grow.

I think you missed out on a myriad of spending traps, just because the Dao hasn’t spent anything.

The list you made deals with the highest risk vectors I think, and I find it to be reassuring that we’re considering these pitfalls, rather than finding them with our feet. What we need to be sure of is that this foresight and momentum is carried into the places where it’s needed most, so the advantage does not go unseized. That seems to be something you have a natural aptitude for silver

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Great points overall.

This is something that has my attention, and that we should continue to challenge why we are doing the things we are doing, if only as a double check.

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@silver4k, the term was skeuomorphic.

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That’s it. That’s the word. Thanks!

this is a very cool approach and thread. It will take some introspection from all the participants as well as openness to new experiences. definitely agree that we should have these kinds of discussions regularly. I will look into this more closely.