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CharmVerse + Hats Protocol + Govrn: A Panel on Web3 Governance
Recorded: Aug. 16, 2022 Duration: 1:11:19Space Recording
Full Transcription
We both know what to do, pushed it too far, I just wish I would learn what it takes to
the rest, my mistake, but I know it's too late, and this don't keep telling me I should
move on, let it go while you can say it in a song, I don't think we should wait, cause
I don't think we should wait, cause it's too late, and this ain't late, I can't believe
it, baby, if only there was a way to relate, but these tears keep falling inside my mind,
if I only knew, I'm the second one, to move on, to be free,
free from the past, used to dream, it would last, yet what I did, didn't have it in me,
let you be free, and this don't keep telling me I should move on, let it go while you can
say it in a song, I don't think we should wait, cause it's too late, and this don't
think we should wait, cause it's too late, and this don't think we should wait, cause it's
late, and this don't think we should wait, cause it's too late, and this don't think we should
If I only knew, I'd have seen you.
Looking back, we both knew.
We did what we could, that's what we should.
We can break it, we can make it.
Younger will be, it's still worth it.
Every day, all the fear, is to be near.
And this love keeps telling me, yeah, we should move on.
Letting go while you can't say it with a song.
I don't think we should wait, it's hurt too far.
The dream is doing, no one's getting late.
God, I'm gonna do it.
And this ain't made, don't believe in faith.
And if only, never, wait to relate.
But these days keep falling, it's time for mine.
If I only knew, I'd have seen you.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Goodbye.
Hi, everyone.
Thanks for joining our Twitter space today.
We're excited to be hosting this panel on Web3 Governance.
I'm Alex, the Community Manager for Charmverse.
Hey, guys.
Camille here.
I'm working at Charmverse as well, and I'm in charge of growth and basically all partnerships
and outreach with Alex.
Yeah, thanks again for joining us, everyone.
A little shout out for Charmverse.
We are a Web3 operations platform handling docs, tasks, bounties, and proposals.
It is a place for team contributors to coordinate day-to-day work, sign in with crypto wallets,
and unlock workspaces with tokens and NFTs.
And today, we'll be speaking with Aaron and Stefan from Govern, as well as Nick and Spencer from Hats Protocol.
And we have our very own Charmverse co-founder, Alex Poon, here as well.
The space is going to be about 45 minutes.
So, we are going to attempt to tackle this major topic within that time frame.
I do encourage listeners and guests to share the space.
And Camille, why don't you tell our listeners a little bit about the space that we're talking about today?
Yep.
Sorry, I talked a bit earlier.
It looks like I got it wrong.
First of all, Alex, love the music for today.
Welcome, everyone.
Camille here.
I'll be handling and moderating the spaces with Alex that's on the Charmverse community account today.
So, today we'll be talking about Web3 governance, talking about everything and anything from what's governance in Web3 today
to can we actually use it for elections, national elections, to corruption and propaganda,
all those sort of things, talking about the foundations of it at first as well.
And we'll be hearing from Govern and Hats, and I'm so hyped for that.
Tune in and actually listen to the whole space, because at some point we'll be dropping the secret password to our FOAP.
So, make sure that you have your actual, you know, FOAP app on your mobile,
because then you can just log into that and type in the secret phrase that we'll be giving out during the spaces.
All right, let's get started.
Okay, so thank you to Aaron, Stefan, and Spencer and Nick, as well as Alex, to join us today to speak.
We're so excited to be talking to so many, like, influential people in the DAO space.
And let's start by actually talking about, like, the projects that are here, including Govern and Hats.
Aaron, why don't you kick us off?
Sorry, did you ask me to kick it off?
Yeah, go ahead.
Yes.
Amazing, amazing.
Well, yeah, thank you for having us on.
I'm very happy to be here.
This is a squad of people up here.
I'm pretty psyched.
This is a good group.
We're about to have a great conversation.
I'm Aaron, one of the founders at Govern.
And at Govern, we make it really easy and simple for DAO contributors to track, record, manage, and own the contributions they make to their DAOs.
And when we say contributions, we mean things like your work that you do.
Like, are you taking notes in a meeting?
Are you tweeting about it?
Are you doing Twitter spaces, onboarding people, contributing to the GitHub repo, managing the Discord?
All of these different types of DAO contributions you make, we make it really easy to track, manage, record, and own those DAO contributions.
So you're going to be more fairly rewarded by the DAOs you work with, ultimately building a contribution graph of all the different work you've done.
So, yeah, I'm pretty excited to be here today and speaking about it.
So cool.
Today with Aaron, we have Stefan as well from Govern.
Stefan, anything to add to what Aaron just said?
Actually, I don't know.
It looks like you're not a speaker right now.
Alex, can we make Stefan a speaker?
Yeah, let me, I thought I did.
Let's see.
All right.
Meanwhile, let's hear from Nick and Spencer.
What about, like, HATS?
What are you guys building?
Hey, everyone.
Thank you so much for having us.
It's a pleasure to be here and be amongst such smart people and good friends.
With HATS, we see that the current state of DAO governance is that the governance itself, like full consensus voting, is often getting in the way of DAO effectiveness.
And what we're out to build is the way that DAOs get things done.
And we think that the main missing piece is the ability for a DAO to delegate responsibility, authority, and hold people accountable for what they're supposed to be getting done at the behest of the DAO.
And be able to revoke that as a form of the accountability that's relevant.
And we implement this using non-transferable NFTs.
HATS protocol is a way of generating, for a DAO to generate any types of tokens that it wants so that it can use those tokens to represent these roles and authorities, revoke them,
and ultimately use them for token gating across access control tooling, permissioning tooling.
And you can see this being used in a number of cases, like assigning someone the Twitter manager role of the DAO and being able to access the Twitter account post Twitter spaces or post tweets.
Or gating access to a multisig using a HAT, making someone a signer if they have the HAT token in their wallet.
Or even being a representative of the DAO externally so that the DAO can signify to someone that someone is able to go to other DAOs to make DAOs to make DAO-to-DAO partnerships on behalf of the DAO.
And there are a number of different use cases that we're expecting.
We think this is a very emergent space.
And this is just one primitive that is going to be largely composable across the ecosystem.
So, again, super excited to be here and composing with you all today.
Amazing.
Spencer, anything to add to the very full description that Nick gave?
No, not at all.
Just want to say that it's awesome to be here.
Thanks for having us.
And excited to get into some of the juicy things I know we're going to talk about today.
Really cool.
Spencer, by the way, I was reading about Anti-Capture the other day, the article you posted.
Maybe you want to tell us more about that.
And that talks a bit about your influence in the space.
And I really love that article.
And it looks like Aaron is loving it as well.
Tell us more about it.
Well, I almost want to ask, like, how much time do we have?
Because I could talk about that for forever.
But maybe I'll just give a little teaser.
But actually, first, I appreciate those, the kind words.
And I'm super glad that it's continuing to make its way around.
Anti-Capture is, for those who don't know, is an article I wrote as sort of the culmination of maybe we'll call it like the first part of some research that I had been doing.
Or have been doing, trying to get at the heart of what makes a DAO a DAO.
And what is this thing called decentralized governance that we're all trying to do?
And where I ended up was formulating a framework to how to think about and understand governance through the lens of capture resistance.
So that's where the term or the name anti-capture comes from.
And kind of the idea behind it is to sort of break down, try to define what governance is, which is taking actions as a collective, trying to break down those actions into their component pieces to better understand where those actions are susceptible.
Or the processes around those actions are susceptible to capture and how we can build robust structures to prevent or resist capture.
And the conclusion I came to was that DAOs are the most, the type of organization that are the most resistant to capture that we've ever had.
And that's one of the things that makes them so exciting.
And I love this.
Honestly, like, Nick, you were about to speak.
Do you want to add anything to that?
I was just going to ask if ending up on the OFAC sanctions list is a form of capture in your eyes.
Yes.
All right.
Stevan, just join us.
Just want to say hi as well to Stevan.
Hi, Stevan.
Hey, sorry about that.
Just a quick heads up.
Whenever I'm on a Twitter Spaces, everyone gets to play this really fun game called Will Stevan Get Rugged?
And it's pretty easy to win the game because the answer is always yes.
Well, I'm glad you could make it.
Of course, of course.
Stevan, since you're here right now talking, why don't you also tell us a bit more about the type of people that work on DAOs and governance protocol?
You know, like, why you guys are here talking today?
You know, this is an early vertical, an early industry.
And why did you decide to go all in on that with Govern and Hats?
Like, anything that you all share besides, like, this passion for the space?
Sure.
So, I am growth lead at Govern with Aaron.
I missed his intro, unfortunately.
But the way I got into the space in particular, I also run the Caribbean Blockchain Alliance, which is focused on mainly blockchain education and public policy in the Caribbean.
And that was kind of my entry into the space because I just saw, you know, how important this technology is, how useful it's going to be.
And then, I would say, close to the end of 2020, I started really paying attention to DAOs.
I realized that, you know, the premise of it was very similar to kind of work I'd done related to, like, studies I'd done related to cooperatives.
And just, like, more flat and more equitable structures and entities in general, especially for work.
So, yeah, I realized pretty, pretty quickly that how important DAO is going to be and how useful they're going to be and how global they're going to be.
And at the same time, I'd say, you know, around this time last year, I started working with PrimeDAO as well as the DAOist.
And I've been working with them for a few months.
And then earlier this year, I joined Govern full time.
So, when we're talking about DAOs and we're talking about governance, I feel like we think about politics at the same time.
So, what's your stance on politics within DAOs and tokenized communities?
And I guess part two of my question is, how do you see phenomenons like propaganda and corruption developing as the tech develops?
And I guess whoever wants to step in and answer that one first.
I can take a crack at this.
Yeah, go for it.
So, maybe just before I dig in, just to maybe set some context or clarify, when we say politics in the context of DAOs, do we mean like politics from IRL coming into the DAO space?
Or do we mean the way that people within a DAO or within an ecosystem or a community try to make decisions or try to advocate for their preferred proposals or outcomes?
Is it more the latter?
Yeah, more the latter, I think.
Agreed.
Cool.
So, I mean, that's inevitable.
I mean, people, the bigger DAOs get, the more diverse the membership, the more diverse the needs and wants and desires and perspectives of the people that are in those DAOs.
And therefore, the more chance for maybe not even conflict, but differences of opinion or differences of objectives and different support, differential support for different outcomes and proposals.
So, there's absolutely, I think we've already seen this in a lot of, in a lot of the bigger DAOs thus far, there's absolutely going to be an element of politics and politicking and influence and things like that.
I think where, I think where DAOs have an opportunity to improve on the situation that we have in the real world from a political perspective, which I think everybody can recognize as a complete disaster regardless of your political views.
I think where DAOs can make a big difference and improve upon that is in transparency.
One of the reasons, transparency and autonomy, actually.
So, one of the reasons I think we struggle with political decision-making and politics in the real world is access to the right information is so concentrated and not widely distributed, which then creates pathways for people who do have access to that information,
or maybe even claim to have access to that information, to create bottlenecks around themselves and to kind of start to capture the narrative associated with that information,
which then makes it very, very difficult for any meaningful conversations to actually happen.
And then you get this very identity-based political bickering and fighting, not actual real debate.
But if in DAOs, we're able to maintain the level of transparency that we have today, because everything's in SPAR contracts and publicly available,
then it'll kind of undercut the possibility of somebody trying to use their influence to hide the truth about something.
So, I think we're starting from a much healthier perspective or position.
We're going to need to fight to maintain that.
There's going to be lots of forces that try to close things off, try to create the conditions for their kind of political influence and peddling to prevail.
But I think we, so the more we make rules and structures and protocols that put all of this stuff in protocol that can be managed explicitly rather than implicitly or based on influence,
I think the better off and the better chance we'll have to prevent that kind of bad outcome from happening.
Yeah, Alex.
Yeah, so I am very much in agreement with Spencer here that I think transparency makes a big difference in just, you know, sunlight really shines on and remove a lot of the issues.
I would add that I'll add an example in my prior Web2 life.
We were running a larger team and trying to really introduce distributed decision-making across the team.
And one experiment that we ran was letting the whole company of 60 people vote on which project, which sort of project we should build or work on the next quarter.
So, we apply a lot of transparency, right?
Everybody knows what all the projects are and who could be working on them.
We still end up running into a bunch of problems in terms of there are people, I mean, blatantly in the open asking people for favors in, you know, voting for their project.
That's the type of project they want to work on.
Because if you're a data scientist, they want to work on some fancy data science model that might not necessarily really move the business forward.
So, I guess to add to that and using an example is that I learned in addition to transparency is finding ways to align interests in terms of like the mission and vision of the organization.
And in my example, what me, I failed to do a good enough job is really communicating and then driving those alignments so that when the data scientist is trying to pitch in for, you know, the data science project that might happen, that they really truly take that into account of how much of that project will drive the impact of the business.
And then that's particularly what I'm excited about, where three, where, when, when you have smart contracts and tokens, I think give us a lot more tools that in a transparent way to, to align interests the right way.
Go ahead, Aaron.
I mean, I saw an unmute thing happen.
I think transparency is not the most important thing to be talking about.
And I think we often get to, I don't think transparency fixes politics.
It helps, but it doesn't fix it.
Expand on that.
What do you mean by it actually helps, but doesn't fix it?
What would be your way to fixing this?
Yeah.
Yeah.
Not to disagree with, with, with Spencer and Alex here.
Transparency is cool.
Transparency is needed.
And transparency is like really just like one small piece into the bigger problem.
Transparency, really what we're talking about is the access of information and knowledge.
The idea being that knowledge creates power, right?
And it does to a certain extent.
But like transparency can help make sure everyone is operating with the same, similar set of facts.
But like, well, you can look at it a couple of different ways.
Like the U.S., sorry, not to go into nation states, but nation states have been making things more transparent for years, right?
Like I, like there is an open gov, like open data foundation for the federal government, which publishes these public data sets all the time, right?
Like we have an insane amount of access to, to information in our governance, in our government services, in our politics, and like even in our DAOs right now.
And like that doesn't necessarily stop politics from happening.
That doesn't necessarily fix political problems that we're seeing, whether it's in DAOs or not, right?
Ultimately, what I think is like the actual thing, and you can say that like information is just one piece of this.
It's actually the power of organizing and the power to assemble.
And I actually want to bring it back to the anti-capture framework that Spencer brought up earlier.
And, you know, Spencer, come on, man, when we do it, it's all about anti-capture.
I'm like, well, plus a thousand, the anti-capture framework, I think it's the greatest thing ever.
You have politics, like you have unfair politics happens when we don't have similar accesses to a power.
And in my opinion, the ultimate form of power is the ability to assemble, is the ability to organize.
Like that is our superpower as humans, is to organize together to create bigger and better things, right?
Why DAOs are so effing cool is not because like there's a lot of closed source DAOs, right?
There's a lot of not transparent DAOs, right?
That might have zero politics, right?
What is cool about DAOs is it lowers the cost to organize and assemble to a very, very low barrier of entry.
Like anybody can jump in and start assembling now and anybody can start coordinating around anything.
And we can create these groups out of thin air so easily now.
And so that means no matter how small your opinion, you can create a group, no matter how big opinion, you can create a group.
Or more importantly, if you're part of a group that you no longer want to be a part of, you can form your own group.
And really what that's getting into is the consent of the governed, right?
And when you don't have the ability to create new groups, when you don't have the ability to spin up new ideas and freely assemble, right?
You are actually limiting the ability to – the idea of like the consent to be governed because you have – you are forced into the same – this one group with no alternatives.
And once you are forced into a group with no alternatives and you don't give your consent to be governed, all of a sudden we're now – there's – we've now created a situation where there can only ever be one answer.
And I don't like – I don't care if your DAO is a bajillion people or your DAO is two people.
If your DAO is ever more than one people, you're going to have – like you're going to have compromise.
You're going to have these conflicts and there's going to be politics.
Because when you don't have optionality, you force people to go to the same opinion, the same solution.
And that means there's always going to be someone that's unhappy.
We are just like all unique and different beings.
And when you are forced into one solution, you have to like eliminate the differences that make us so unique and cool rather than celebrating them and allowing us to organize around new ideas.
So, yes, transparency is good.
But that's what I just call like open governance, right?
What we actually need, the freedom to assemble and contribute, I call open source governance, right?
And that is actually how we start to make politics in DAOs or whatever context a little bit better in my opinion.
Amazing.
Thanks, Aaron, for this very great answer.
Nick, Stefan, what's your take on this?
Is it transparency or is it more open source governance, to quote Aaron?
For me, I actually think about it a lot in terms of cultural and the cultural aspects.
So – and obviously, this is something that's different depending on where you are in the world or where you are.
But a lot of times you see people, especially, you know, not talking to people in the space, not talking to people in Dallas, just, you know, regular everyday people who are just doing what they do.
A lot of times you'll see culturally they're very much focused on or maybe they're beholden to this kind of hierarchical structure in different forms, right?
Whether it's at work with, you know, the CEO or a corporation or whatnot.
Or even just in general, like, they're very focused on maybe a leader or a government or whoever providing for them, things like that.
Like, which means that culturally they're just not very autonomous.
They don't have that kind of mentality per se.
I think as we kind of establish DAOs, as we proliferate DAOs, as more everyday people start using DAOs, it's not just the transparency.
It's not just the structures that they get to understand.
But it's also this idea of being an autonomous individual or being part of autonomous communities, which means that now it's a complete mental shift.
It's a complete mindset shift.
Now we're doing things for ourselves.
We're owning our own work.
We're owning our own contributions.
And if we think of DAOs as the future of work, then where do we spend the most time at work or what do you spend the most time doing?
We're working.
So if we're ready, if we're shifting the way that we think about that, the thing that we're doing more often than not, then we eventually take that idea, take these mindset shifts into the way we think about governance and the way we think about hierarchy in general.
And that kind of paradigm shift will drive so much in terms of how we operate as maybe nation states or communities or collectives or society in general.
So for me, that's really the shift at the end of the day, the goal at the end of the day, creating these kind of autonomous communities, these autonomous individuals, this autonomous society.
And that I do think, to a large degree, will come from DAOs.
Yeah, I want to plus one to what Spencer or Stefan just said there.
I think we don't say that enough.
Like, we are all autonomous individuals.
Like, that is, like, the true beauty of the space.
It's, like, honestly, the first thing I tell myself in the mirror in the morning.
I'm just, like, you are an autonomous individual, Aaron.
It's the best validation you can give yourself.
I'm going to take a little bit of a different tack on this.
Like, classes or in maybe categories of power in an organization.
There's capital, there's labor, and there's management.
And what we're seeing with DAOs is that there's – everyone in the labor is becoming a manager.
Everyone in capital is becoming a manager by way of full consensus governance, token holding.
And that management, I think, is increasingly going to be automated.
And that automation is actually going to be well-received in DAOs relative to traditional organizations, in part because everyone is an owner.
If in a traditional job today, if you could automate yourself out of a job, then you might do that and keep it a secret to save yourself time.
But in a DAO, you might do that and publicize it because you would be more likely to be fairly rewarded because of your ownership position and because of the ways that DAOs distribute value.
But I think that we will have – as individuals, we'll have more desire for sovereignty and choose organizations where we have that sovereignty.
And I think we'll choose DAOs more often than we'll choose traditional organizational structures.
And we'll be more – we'll be less likely to choose organizations that include politics and more likely to choose organizations that are transparent.
So I think to kind of build off of what everyone has said so far, it becomes basically like an open – a free market for which organizations that we want to participate in,
where the organizations themselves are competing on the experience that they can give to their participants.
And I think that that is a really exciting aspect of how DAOs are going to change the world.
Yeah, actually, I agree 100%.
And I mean, like, also, like, the way people work in DAOs, it's not anymore like you have, like, a one full-time job.
It's like you work, like, two, three hours per week in, like, a certain DAO, four hours a week in another DAO,
and then just spend the rest of your time on, like, the Web3 kind of spaces.
And I think that's really interesting to see, like, how you choose, like, your own communities.
Kind of a follow-up question, guys, to all that we've been saying.
There's this practice nowadays in DAOs, which is called delegation to our audience.
That's basically when you give your votes to someone in the community because you just are not active in the DAO,
and so that person has more of a voting power and is going to be kind of a leader in the DAO in the sense that, like,
they're going to, you know, take on a more important say in where the DAO is going.
So kind of my question is how do we prevent abuse around delegation?
And just before I let you all answer that question, I just want to say,
Twitter, please include an agreed emoji because every time I don't know which emoji to use
to agree with what you guys are saying.
They had the, I think they had the fire emoji and they removed it.
I don't know why.
All right, Alex, maybe you want to start that one?
We haven't heard from you in a while.
Actually, I'll go second.
Sorry.
I could jump in.
Funny enough, delegation in DAOs is something that I've kind of grappled with for a long time
because I was, especially early on, I was really against the idea of it.
You know, because obviously that's already a bit of a centralizing force, right?
But I, the more I worked in DAOs, the more I realized, well, it's very hard to get people
to vote and to actually do governance, especially the larger the DAO is.
And of course, I think, yeah, I think a lot of this depends on size and the type of DAO too.
So I'm a lot more open to delegation than I was before.
But I think no matter what, there should always, like, delegation should always be extremely
fluid, meaning that if, you know, if you have delegates, it should always be very easy to
remove the current ones and put new ones in.
And that should always be an ongoing process.
And at the same time, there should never be a time when, you know, one delegate or a few
delegates are always up.
That should always be somewhat rotating.
You know, I don't know the optimal length of time for that, but it should never be just,
oh, these delegates are always going to be the delegates.
That should be somewhat fluid.
Um, and even in terms of, and obviously this is hard when things are on chain, but it should
be as cheap or free as much as possible to delegate, uh, unstake to, to delegate, like
whatever that process is, it should be very easy and practically free, if not completely
free.
Um, cause it's also like, you know, co-ops there are like, if you look back at co-ops and
co-operatives, they don't, they, they're usually one person, one vote, uh, every once in a while,
a few of them, you'll have some with maybe a few delegates, but even in terms of their
management, right.
They'll have, cause co-ops aren't necessarily completely flat.
A lot of them do have quote unquote managers, but it's the same idea.
They're very fluid, meaning that it's very easy to vote them out.
It's very easy to replace them.
And I think as long as DAOs have that capacity and capability, then, then it's okay.
So I'll, I'll add to that.
I, um, a16z recently published a paper on their delegation framework.
Um, I think a couple of points I found interesting was that they, you know, they talked about the
idea of, um, it, the, the, the, the change in delegation is pretty fluid, but they also want
to commit to some kind of minimum amount, minimum amount, amount of time that the delegate will
get the, uh, to get the hold of power for a while.
Um, which I thought it was really interesting, uh, and using that to make sure that the, the,
the, the person that had the voting power are not so dependent on, or worry about getting
voted out very quickly.
So therefore ended up pretty much voting, uh, in, in the interest of the token holder all
the time, uh, they, the part of the delegation for them is, is to creating independent minded
delegates so then they can vote, uh, using their expertise or their, their point of view.
Um, and then I think compare and contrast that to, you know, the U S, uh, political system
where, um, perhaps the voting terms are a bit too long.
And then like when, uh, every three years, every four years or every two years, whatever
the, the number, um, and then by the time the voting comes in, people don't show up to
vote.
And therefore it's by default, the delegate continue to hold the power.
Um, I think it's finding that, that, that balance of like having a long enough time, uh, to be
independent, but, uh, fluid enough so that the power truly feel like you're being checked
on a regular basis.
Uh, yeah, I actually want to jump in here and provide a, sorry, Nick, I'll, I'll make this
quick and then I'll let you talk, uh, a counterpoint.
I think it's really important that we separate the two types of delegation because there's
one type of delegation I'm like pretty against, um, as a bunch of people on this call, no
of like political delegation.
Um, I have some pretty distinct thoughts on that, but I have been converted recently to
understanding about regulation or operational delegation, which I am much more pro and
for, right.
And not to like tee it up for the people at hats a little too, too much here.
But like, I think delegating operational regulation, regulatory things makes a lot of sense.
Um, and that's one context we need to speak about.
Then we can talk about another context of what the political realm looks like, because those
are very different delegations and different things.
And I think we should be very explicit when we separate those two things out.
Yeah, that makes sense.
Uh, Nick, go ahead.
It's a, um, really great, great jam on this with, uh, Drake, uh, coordinate.
And it's kind of like, it's two directions of delegation.
There's, you know, there's like a Gitcoin or ENS style delegation that's trying to do basically
representative democracy.
And then like, you know, people don't have to engage as much because their vote doesn't
count that much or whatever.
And then there's the, uh, Drake originally called it constrained delegation, but it's kind
of, uh, their, the delegations of voting power in the ENS and Gitcoin case are good control
of the full governance surface of the DAO, the full consensus voting model.
And then that the DAO itself can take things that it's responsible for in that full governance
surface and give them to individual people or to pods, uh, or even to AIs, um, and, and
make sure that they are getting done in a, in a smaller group.
That's able to move faster, uh, without having that full consensus.
And I like the idea of operational delegation.
That's a nice way to frame it.
But this is, this is the way that human organizations have gotten things done for the last 10,000 years.
It's, it's, it's crazy to think that we don't have that in DAOs yet.
Um, this is really what, one of the main focuses of, uh, what HATS protocol is trying to add in a,
in a web three native on-chain way is that, that DAO, the DAO, whether it's made up of delegates
or individuals, FFT holders, or, you know, it's a Moloch DAO, uh, can, it can assign someone
the role or the responsibility to get things done and then how the DAO can evaluate on a regular basis
whether or not they're doing a good job and hold them accountable.
And that is, in my opinion, this is part of what is going to empower the next phase of DAO governance.
Because right now we, we're getting stuck in being, not being able to get things done efficiently.
But if you can imagine, just totally plug the space here, you can imagine like a group of people
who are managing their, their work, uh, in Charmverse, like an interface for all of the,
all of the work they're getting, they're getting empowered to do specific things.
They have the expertise required, uh, all the content required, and they've been delegated
the authority and the access control to do their work.
And then they're getting governed, uh, contributor data recorded with the, uh, NFTs or otherwise.
And then that is actually the part of the reward structure.
You suddenly have this organization that is extremely, uh, capable of being effective and getting shit done.
This doesn't exist in DAOs today, but when it does, and we improve this model,
I think we're going to totally revolutionize what, what the complexity of goals that DAOs are, uh, capable of achieving reproducibly.
Yeah.
I love what Nick just, just said here.
Um, and I, I think there's actually a lot of models in our historical context we can look back to, um, not to like show too much here.
I wrote a, uh, uh, I was, I was going to write a three part, uh, article series, but I only got to the first part where I like broke down like IRL governance systems into three buckets, um, of which, you know, I called their like constituent civic engagement politics or for politicians.
And then operational, um, like regulars and organizing government.
So you had like politics, government, and civic engagement.
Um, and I think those three things exist in the crypto world as well, right?
You have delegates and token holders, you have, um, you have system, uh, you have civic engagement by the users and also potentially token holders.
And then you have those that actually carry out the decisions, the people that work for the protocol or are operationally delegates.
Um, and the crazy thing about crypto is that if you think about those three circles as a Venn diagram, the more they overlap, the closer we get to self-governance.
And the cool thing about DAOs and crypto is that we can now control the parameters, um, between those three things.
And so I think that it's like a really good way to think through how are we better empowering people to govern themselves?
Is it by giving them more political control over themselves, operational control over themselves, um, or keeping it in a distinct liquid fluid way?
Um, I'm really glad you, you brought up the operational delegate or delegation term, like, uh, like Nick was saying within the hats, within the hats team.
We've been trying to think of like the way to, to talk about that type of delegation as distinct from like governance or political delegation.
Um, and we didn't come up with operational delegation.
It's really good, but two, two terms that we kind of came up with, um, I just want to take an opportunity to ecology nerd snipe, uh, Stefan here is, uh, like using the, a tree analogy of, uh, like nutrients flowing in, in two directions.
So like xylem and phloem, I forget which way, which one goes, which way, but some nutrients are coming up from the ground, um, and go like up, up the tree.
And then some nutrients are coming well from light and coming down, down the tree.
Um, I don't know if there's anything to that in terms of the way we can actually make it make sense to other people, but, uh, there is definitely something to this idea of bi-directional or like a multi-directional.
Um, blowing of, of value delegation, responsibility, authority, and the more we can put really crisp language around it.
And the more we can build really crisp, clear, explicit protocols for managing it, the better off we'll all be.
So let me, I just want to kick it back to you, Spencer and Nick.
Um, but I'm curious, what do you think is a better way to do delegation?
Is it more tools of accountability or is it more liquid power dynamics?
Like, is it like, should we create more tools to hold people accountable or does it just make it so easy to, to take away their power that that's the tool tool?
I think it's, I think it's, I think it has to be both.
Um, I think we can break down this question into the kind of age old trade-off between
automatability and like specificity.
Specificity, so on one side and then subjectivity and like generalizability on the, on the other side.
I don't think we're ever going to, like, I don't think anything ever is going to fall fully on one end of that spectrum.
Um, we're always going to need tools that facilitate, um, something in the middle or, or multiple aspects or like a couple of different modes of that.
And so I think we need the, we need the more humanistic approach where we can enable individual humans to like easily retract their support or, uh, vote for revocation.
But then we also need, uh, more mechanistic or other mechanisms like staking for accountability or, um, like more automated rules for revoking of power or, or authorities or, um, other kinds of, other kinds of automated things.
I think we're going to need both.
So interesting, if you don't mind me like taking it back one more time, there's this, uh, famous line.
From West Wing where the, uh, Jed Bartlett was giving a talk to, to a group of college students and he said, decisions are made by those that show up.
Right.
And he asked who is failing, who are politicians failing kids or kids failing, or like are young people failing politicians?
Right.
So another way for DAOs, right.
Is like the half the battle, just like half the battle is just showing up or like decisions are made by those that show up, which is failing which right now?
Um, sorry, which, what are the witches in that sentence?
Uh, the delegates or the people that delegate responsibility to them.
Like we can hold people accountable, but if people aren't showing up, the decisions will be made by those that show up.
And then what happens if like, how do we, yeah, I'm just kind of curious what your thoughts are on that.
Um, yeah, I don't know.
That's a, it's a, there's a lot in there.
I think, um, I think part of it is designing or structuring governance systems.
Um, I think the design space that we have accessible to us now with DAOs and with like in the ability to create protocols that do like can do lots of different things.
I think the design space is much larger than it has been in the past for governance.
So I think we, you know, in one sense, we have the ability to design our governance governance systems such that it's not just the people that show up, or we create more incentives for more people to show up, or we more direct incentives, more people to show up, or we don't attach decision-making weight or practical decision weight to only the people that show up.
We attach it to some other variable or multiple variables, and we constrain the importance of just showing up, or we reduce the importance relative to other things.
I think we can do that much more explicitly with smart contracts and, and with DAO technologies than we could before, because before we're in the, like the legacy world, the only way things were done is via social consensus, social consensus, like talking to each other.
So you literally have to show up for that to work, but with, we have smart contracts, we can make more credible commitments to other types of things.
We can encode more explicit logic that doesn't require people to show up for that logic to be enacted or, or implemented.
I love that the way you're saying it of like, we have a greater design space to be designing accountability to, or like ways, what showing up means now we've redefined that.
Sorry, Stefan.
No, yeah, I think that's, that's a super important, I love the, the rabbit hole you guys go around.
And, and on, kind of on a similar note, and also referencing what Nick was saying earlier in terms of, you know, well, one, what Spencer said with designing a governance system, I think this is key to where, what Nick was saying about, you know, your, your, you know, if you have people, contributors, people who are working, whatever,
you're kind of recording the contributions, recording the work they've done themselves, rather than, you know, allowing other people to do it for them.
And then that gets credentialed, whether it's through NFT or verifiable credentials, whatever.
And then also plugging, plugging in hats here, through hats, you can kind of, you're able to like formalize that to say, okay, this is what's getting done, we have, we have basically a better system, potentially, and something where the governance can be based off of the contributions or the work being done, or the people who are, you know, really deep into what's getting done, rather than just kind of this open.
In this open area of, okay, whoever holds the tokens, whoever that may be gets to vote.
And that's actually what I think is causing a lot of the lack of showing up, because if you're buying tokens, you're doing it for different reasons.
You don't necessarily buy them because you want to vote, you may only be interested in upside or whatnot.
And if you kind of, and not that every DAO will have to do this, but if you do reduce that to, hey, the people who are actually involved in building and actually driving this will have more say to build, to create this kind of contribution-based governance, I think we'll have a lot more just effectiveness in how these DAOs operate.
All right.
Wow.
But we've used up a lot of time and only a few questions.
You guys are going down the rabbit hole for sure.
What's everyone's...
Nobody could have predicted that.
I know, right?
We saw that coming.
I don't know what everyone's timeline is.
If you want another question on here, or if people have places to be.
Do it.
Do it.
All right.
Do it.
Yeah, what is it?
First, I'm going to do a quick POAP shout out, because we made a POAP for today's space.
So everyone get your POAP mobile app, go in there, hit Mint, and enter the phrase dragon fruit, all one word, all lowercase, dragon fruit.
Okay.
Moving on to another question about decentralization.
I don't know that decentralization is realistic or optimal.
What type of governance do you think is optimal?
Completely decentralized, centralized, moderate?
Spencer, you want to take it?
Sure.
I think the...
I will, with respect, reject the premise of the question.
Or question the premise of the question.
I think a different frame to look at this about, or to view this with, is to ask about what is being decentralized.
There is decentralization, or there's possible to have decentralization or centralization along multiple different dimensions.
And I think, kind of as I was saying before, with DAOs, with smart contracts, with blockchains, we have more specific, concrete access to the levers to change the degree of decentralization versus centralization along those specific dimensions than we've ever had before.
And I think that's one of the reasons why the design space that we have is so huge now, is so much bigger.
We can have decentralization along executive power, the ability to actually implement an action.
We have decentralization versus centralization along decision-making, which is part of taking an action, but doesn't actually involve taking the action itself.
We can have decentralization versus centralization along access to information or access to other things or other kinds of rights.
So I think we can also have concentration versus distribution or decentralization versus centralization on economic upside or economic rights.
And there's probably even more dimensions that I'm not even able to think about right now.
I think we have the ability to tailor or dial up or down the degree of decentralization on any of those dimensions.
And for a given organization, for a given network, for a given DAO, find the right levels for that DAO's context at a particular time that make that DAO most effective and most resilient.
So that does not necessarily mean the most effective and most resilient settings or parameters for a DAO does not always mean it's fully decentralized on every dimension.
We can make trade-offs where we go more centralized or more concentrated on, say, who has the ability to actually contribute code to a protocol, for example, or make other contributions.
We can, even while we leave open, wide open and permissionless, the ability to have economic upside based on the value of the protocol.
We can also constrain quite a bit the decision-making weight while leaving very decentralized the execution rights.
We can do that via accountability mechanisms or other kind of delegation, delegation mechanisms like HATS protocol, even.
So there's lots of different things that we can do to try to avoid having to ask ourselves the really hard question of, generally speaking, should we be decentralized or generally speaking, should we be decentralized?
Anyone else want to jump in on this?
No, but before I get on my soapbox, is Nick or Stefan or Alex or Charles or someone?
I like the idea of having a different degree of the essentialization based on the stage of the organization.
I mean, again, looking at Charmverse, we are not currently a DAO.
We certainly have the desire to decentralize both the product and the way we make decisions as we move forward.
But yeah, we do.
But yeah, I think as one of the founders, I think that is that difficulty of trying to figure out where those lever lies.
And also trying to find the right timing to do it right, because I feel like particularly when you start to decentralize, it is more of a one-way door in terms of decision-making so that there's no walking back necessarily.
So finding that those areas and how do we build product in the form of transfers that are quick, that are something that we can do our best to strike product market fit while maintaining that north star of eventually decentralizing, I think, is something that's a work in progress for us.
I'll just jump in quickly to say huge plus one.
I'm an organizational effectiveness maxi.
And if the organization has a goal and a reason to be decentralized and that's of service to its other goals, and those goals are good and we'll say moral, but leave that out for now, then doing what's necessary to make that happen is where I'm a fan of.
I think decentralization is a tool, and we should use the tool to achieve our goals.
Yeah, so I actually have a bit of a different take.
And the idea of it being a one-way door, I know several dictators who would beg to differ that you can very easily centralize and take power back over.
But I think we're looking at the question a little bit incorrectly in my opinion.
And first, I'm going to want to address the idea of operational efficiency and where I think there's a misnomer in the decentralization aspect.
And then two, why I actually don't know if I'm a decentralization pro-proponent anymore and why I'm rather an anti-capture proponent.
But to start with the decentralization idea that more efficient organizations can run better or we can make quicker decisions if we get rid of decentralization at the beginning, I think this is generally true.
I get the point here, and I do agree there, but I think it's also just one way of doing things.
I'm very much anti.
I have a very big problem with the benevolent dictator system.
I get that there's a lot of benevolent dictatorships out there right now or groups that use benevolent dictators to actually get things done.
And I think that's great.
And I think that works pretty well until it doesn't work, right?
It's like we all love benevolent dictators until they just drop the benevolent piece and you're like, oh, well, damn, this sucks, right?
And so I think that that's a problem that we're always going to run into and why I'm pretty worried about opting for this path just without even thinking about it.
Something I do like about path, to be honest, is that it's benevolent dictator with conditions, right, that you can revoke the power from the dictator at any point in time.
The consent of government is still held in there, right?
Peter Pan used to do this thought experiment, which is if you lived in a dictatorship, but you're able to rage quit the country at any time you want, is it really a bad thing, right?
And what I've been like learning a little bit more about, there's this book, which I just finished reading, I highly recommend it.
I don't know if I already mentioned it in this call or a different call I was in, which is it's called Open Organizations.
It's by James Whitehurst, which is he's the CEO of Red Hat.
And what he talks about there is that, yes, if you're a leader and you're in a centralized, Red Hat really prioritized open source methodology.
They bring in people heavily into their decision-making process.
And when you are like using a centralized decision-making process, what ended up happening is you are able to make decisions a lot more quickly, but to get organizational adoption was a lot longer.
It took a lot longer, right?
And the same thing I would say for products when we build products, yes, we as a team can make decisions a lot more quickly.
But if we don't necessarily get buy-in from our users first on what products they want to see or use or what will be beneficial, we have to spend a lot of time showing people why the product we decided to build would be actually valuable and to get buy-in from our users and stakeholders.
And really all we're doing is we're transitioning time between bringing people into the decision-making process and then bringing people into the change management process.
Change management is the idea of a decision was made.
Now we have to get everybody on board.
And I can even tell you from experience, I was in a DAO recently that operates with a pretty decentralized charter that recently created a proposal that operated as a much more centralized decision-making power.
And it took a lot longer to get the thing passed and even adopted.
Now, I would even say it's like an adopted idea because people weren't brought into the decision-making process.
And so I think when we – like I agree like we need to be thinking from an operational efficiency standpoint.
I'm like really with Nick on this one.
I just guess I'm not so bought into the idea that benevolent dictatorships automatically create more benefits for the operational efficiency in the long term, I should say.
I think there's an important distinction between efficiency and effectiveness.
Ooh, that's a good point.
Well, Laura, actually before I agree, what's your distinction?
You can be really, really efficient at doing something that's not effective.
Effectiveness is the degree to which you're able to accomplish your goals.
Efficiency is the, let's say, the amount of resources it takes to get there.
Yeah.
But you could be running really fast in the wrong direction.
Right.
The effectiveness would be the actual impact that comes from your decisions, whether they are slow or fast, et cetera.
Yeah, that's a good point.
I really do like that.
But I still think that holds true, right?
I think the more you can bring people into the decision-making process and governance process itself, the more effective the decision will be.
Totally agree.
I think that there's a diminishing return on the number of people you're involved in the process.
I think you want a high number of people represented.
But the best, the people who have the expertise and the context and knowledge is usually a smaller group.
And I think that if that smaller group is empowered to act quickly on behalf of the larger group, that that will on average lead to better outcomes.
Yeah, I do agree with that.
I think there's, like, an amendment to my, like, rant I went on, which is that, like, if your group is, like, going – if the smaller group is going out and, like, getting opinions of the other stakeholders, like, actively, then that's essentially bringing them into the decision-making process, right?
If you spend, like, as a delegated group of individuals, you spend a week or two talking to people, listening, getting buy-in, and then you go make the decision.
I think that's, like, similarly as effective.
And actually, I talk about this in this book as well.
And, you know, I even draw my – before this, I was a management consultant.
And, like, I think a good flip side to this is we would sign these contracts with these major corporations and it was with the executives.
Executives were, like, yeah, make the – make it a simpler process.
You'll be able to make these, like, ten assumptions.
They made the decision and then it was, like, all the consultants' job to now go enforce this decision with all of the actual people that were going to be using the product or the thing that we were implementing.
And so I think, Nick, I would agree with you there that a small group of people can make quicker decisions and you can get the concept of decentralization as long as other opinions are considered when – and, like, you spend time actually reaching out and listening to what people say, right?
It brings up an interesting idea that I think both you and Spencer touch on a lot and Steph and everyone here touches on a lot, which is role-based – like, what are our roles in an organization?
Are you an economic stakeholder, a social stakeholder, a voting stakeholder?
And while maybe your voting stakeholders should be curated at some points in time, informational or economic stakeholders should always be getting considered.
Maybe.
All right.
Just going to jump in here to mention to everyone we know about Depot App Problem.
We fixed it now.
We can actually mint Depot App.
So just a reminder, Depot App actual secret is Dragon Fruit, all lower caps, no space.
All right.
Alex, Spencer, Stefan, Nick, Aaron, anything else you want to add about decentralization before we close down the space?
Because I think we're already a little over time to be expected, as Spencer mentioned.
I mean, for me, the most important thing about decentralization and centralization is what Aaron mentioned earlier, where with centralization, it works until it doesn't.
And that's when you get to the point where, when it stops working, you're pretty much screwed in a lot of ways.
And obviously, that could go into a lot of other things.
But I always really like that point.
As a closing thought, I'll say that part of my why for decentralization is composability.
And I think that what we're doing here today is working across different efforts to create better tooling and better possibility space and more effectiveness for many organizations in a composable way.
So that, to me, is worth it.
And thanks for having me on.
Yeah, thanks.
Thanks for hosting this.
This was really fun.
Yes, it was great.
Huge party.
It was a great time.
Appreciate it.
Hands of comments.
Good times.
Thanks, y'all.
All right, everyone.
Please go follow at Govern HQ on Twitter and at Hats Protocol, also on Twitter.
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We're really excited about what we're building here and including our newest upgrades to our bounty workflow and our newest bounty videos, which is posted on YouTube.
Please follow everyone, subscribe, turn on notifications, and don't forget to mint that Poep that is now working, Dragon Fruit.
And Camille, anything else to add?
Yeah, I just wanted to add as well.
If you guys think you can collab with Charmverse, Govern, or Hats, hit us in the DMs.
I think I speak for everyone when I say the DMs are open.
Or just DM me and I can intro you to Nick, Spencer, Aaron, or Stefan.
But, yeah, I just wanted to thank you guys for taking the time.
I loved our discussion today.
Also, to our audience, if you want access to the articles we mentioned during the space, feel free to DM me.
I'm happy to share them.
Sorry about the little Poep mix-up, but it's fixed now, so you can mint your Poep.
And, yeah, cheers, everyone.
Bye.
Thanks, everyone.
Bye.
