“Collaboratively governed and code-driven, decentralized autonomous organizations (DAOs) are engaged in nothing less than an experiment to reimagine how we connect, collaborate and create.”— World Economic Forum
“The blockchain does one thing: It replaces third-party trust with mathematical proof that something happened.”— Adam Draper, Founder, Boost VC
“We have elected to put our money and faith in a mathematical framework that is free of politics and human error.”— Tyler Winklevoss, Founder, Gemini Cryptocurrency Exchange
“You’re going to start seeing open-source, self-executing contracts gradually improve over time. What the Internet did to publishing, blockchain will do to about 160 different industries. It’s crazy.”— Patrick M. Byrne, CEO of Overstock.com
“Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.”— Marc Andreesen Co-Founder, Andreessen Horowitz
“In a dynamic, decentralized system of individual choice and responsibility, people do not have to trust any authority but their own.”— Virginia Postrel, author
“WEF/WHO and the Davos mindsets are essential to understand [because] this is the mindset that governs our world here in the West. Vast amounts of our leaders, even down to lower levels, ascribe to the globally homogenized and technocratic vision of the world. Do not overlook this.”— Jack Pobosiec, Journalist
This topic is one of the scariest that I have ever encountered. Starting from blockchain technology that is used for cryptocurrency, it quickly led to a new form of connection, governance, and transaction management – decentralized autonomous organizations (DAOs). Klaus Schwab and his World Economic Forum (WEF) are prime drivers of DAOs. What’s so scary about this? Read on.
My prior post addressed the apparent (to me at least) inevitability of Central Bank Digital Currencies (CBDCs) replacing, largely or fully, cryptocurrencies (cryptos). Cryptos are based on what is called “blockchain technology”. Serious techie stuff that actually works, sort of, if you ignore recent crypto catastrophes like FTX and its founder, Sam Bankman-Fried. If you follow the latest crypto market happenings, much else in crypto is getting fried as well.
I have a basic understanding of blockchain technology, which persuaded me that it was just another data and transaction management technology. For non-tech folks, mostly ho-hum stuff. Unfortunately, I am by nature curious about technology, and thought that it might be worth skimming some blockchain material to freshen my understanding.
You will not believe where this quickly led
Despite my efforts to keep abreast of important things like Fourth Turnings and empire collapses (see here), I do not recall reading anything specifically about decentralized autonomous organizations. If I did, I may have dismissed it as yet another techie hype-and-mystery term. What a mistake!
There exists a truly amazing body of recent literature on DAOs and their exploding reach. Far from being just a techie term, DAOs are heading toward “digital everything”. I kid you not.
You may or may not be happy to learn that our good buddies at the WEF appear to be taking the lead in driving DAOs and their adoption. They even offer a toolkit for this purpose should you be inclined to create your very own DAO, with the following overview:
“Collaboratively governed and code-driven, decentralized autonomous organizations (DAOs) are engaged in nothing less than an experiment to reimagine how we connect, collaborate and create [emphasis added]. Although DAOs today manage billions of dollars’ worth of assets, engage millions of contributors and operate across industries as diverse as finance and philanthropy, basic questions regarding operations, governance, law and policy are only just beginning to be addressed by policy-makers, regulators and entrepreneurs. The result of a collaboration involving more than 100 experts spanning the public and private sectors, the DAO Toolkit provides resources for developers, policy-makers and other stakeholders seeking to engage with the DAO ecosystem.”
I have addressed Klaus Schwab and his WEF in a couple of recent posts: “Democracy? Who Needs It When We’ve Got G3P” and “Living In The Metaverse — Our New Virtual Space”. While I am clearly not a fan of Klaus or the WEF, I sure do recognize their rapidly growing power, resources, and reach. My only reservation about their likely gaining some form of world dominance is the helpful characteristic of human nature that leads inevitably to the downfall of the great – the Great-Reset Klaus included. Timing is the issue here. Ultimate failure is not.
What exactly are DAOs?
Now that we have a DAO toolkit available, you may well be wondering what DAOs are and why you might need a DAO toolkit. Good question. Here is a very positive introduction that even features the Metaverse, in case you are already there:
- Cathy Hackl, a chief Metaverse officer, writing in Forbes offers a quite readable introduction to the DAO world: “What Are DAOs And Why You Should Pay Attention”:
“Can you imagine a way of organizing with other people around the world, without knowing each other and establishing your own rules, and making your own decisions autonomously all encoded on a Blockchain? Well, DAOs are making this real.”
“Wikipedia defines DAO (Decentralized Autonomous Organization) as an organization represented by rules encoded as a transparent computer program, controlled by the organization members, and not influenced by a central government. As the rules are embedded into the code, no managers are needed, thus removing any bureaucracy or hierarchy hurdles.”
“Some of today’s internet users and the next generations are looking forward to starting social organizations, searching for an answer to: ‘How can we exchange values in a trusted environment?’ Blockchain enables automated trusted transactions and value exchanges, but even so, internet users around the world want to organize themselves in a ‘Safe and effective way to work with like-minded folks, around the globe’, according to Ethereum.”
“Bitcoin is generally considered to be the first fully functional DAO, as it has programmed rules, functions autonomously, and is coordinated through a consensual protocol.”
Now why might the WEF be featuring and driving DAO development?
- Cointelegraph, a cryptocurrency news site, briefly describes the WEF interest in DAOs: “WEF publishes new in-depth guide to DAOs to air issues, encourage development”:
“The World Economic Forum (WEF) released a ‘toolkit’ for decentralized autonomous organizations (DAOs) on Jan. 17. More than 100 experts contributed to the document’s attempt to provide ‘a starting point for DAOs to develop effective operational, governance and legal strategies.’”
“The 37-page so-called toolkit is explanatory in nature, with concise but encyclopedic entries on DAOs and related topics. It described the toolkit as ‘a set of adaptable resources for key stakeholders to help realize the full potential of this emerging form.’ DAOs have ‘the potential to address many of the shortcomings of the traditional firm while also realizing more equitable governance and operations [emphasis added],’ according to the document.”
“This is not the first look WEF has taken at DAOs, or even its first toolkit. The WEF published the ‘Decentralized Finance: (DeFi) Policy-Maker Toolkit’ in June 2021 and a follow-up report in June 2022.”
Key stakeholders? More equitable government? “Stakeholders” is a primary ESG term. The “G” in ESG refers to governance. The WEF is all over the ESG-world.
Davos 2023 featured crypto technology, blockchain infrastructure, and DAOs
On January 2, 2023, the WEF Davos announcement included three key points: “This is what the future holds for cryptocurrencies”:
- 2022 was a terrible year for cryptocurrencies, with the loss of $2 trillion in market value.
- We could now see the handover of crypto technology and blockchain infrastructure to more regulated and established institutions.
- Cryptography and blockchains will continue to be integral parts of the modern economic toolkit.
Modern economic toolkit? As noted above, the WEF just happens to have such a critter. A brief, telling extract:
“Collaboratively governed and code-driven, decentralized autonomous organizations (DAOs) are engaged in nothing less than an experiment to reimagine how we connect, collaborate and create.”
“Although DAOs today manage billions of dollars’ worth of assets, engage millions of contributors and operate across industries as diverse as finance and philanthropy, basic questions regarding operations, governance, law and policy are only just beginning to be addressed by policy-makers, regulators and entrepreneurs.”
“Leaders in economics are messaging that cryptocurrency is here to stay – that a tokenized economy will consume our future financial interactions whether you and I want them to or not. That blockchain will make public and private documents immutable. Adoption of digital assets is underway.”
“While the underlying technology of cryptography and blockchain is generalizable to all industries and coordinating activities (collectively the building blocks of Web3), experimentation at the core of financial services, among other sectors, continues unabated.”
And, some comments from the audience:
“I hope this time around, once we’re building this new world order or new rules based order, the voice of the global south and the developing world is included,” — Bilawal Bhutto Zardari, Pakistan’s Minister of Foreign Affairs, at WEF Davos January 19, 2023
“WEF is increasingly becoming an unelected world government that the people never asked for and don’t want.” — Elon Musk via Twitter, January 17, 2023
The WEF seems to have a thing about “governance”. It strongly supports controlling investments and lending via ESG ratings (Environmental, Social, and Governance). Now they have a DAO Toolkit that addresses “equitable governance and operations”:
“Combining recent technological innovations with community efforts, DAOs have the potential to address many of the shortcomings of the traditional firm while also realizing more equitable governance and operations.”
Shortcomings of the traditional firm? Rules-based order (New World Order)?
I don’t know about you, but to me these kinds of concepts just scream “one world government”. They would be bad enough coming from academia or even politics. Coming from what today may well be the most powerful organization on earth is truly frightening. Nobody – especially the WEF folks – is anywhere near smart enough to pull this off successfully. A catastrophe seems unavoidable.
Reimagining how we all connect, collaborate, and create?
Why? Our currently extensive repertoire of ways to connect, collaborate, and create has evolved over millennia. Seems to do a pretty good job for most purposes. I wonder who gave the WEF an assignment to reimagine all of this?
DAO in its essence, ex-WEF, is simply another set of mechanics for organizing group efforts, keeping track of whatever needs tracking, and allowing participants to interact via rules called a “smart contract”. A legal basis for DAOs is developing – somewhat along the lines of a standard LLC organization.
A rather active business community is evolving around the use of block chain platforms for handling DAO mechanics. These seem to be working okay for the most part, getting into trouble only when human nature and people get involved. No people, no problems it seems. Or maybe that’s the plan.
Blockchain technology, digital money, digital everything via DAOs? There is a lot of technology buried here that is needed to make all of this digital future work.
Blockchain technology, simply explained
If you are not familiar with this recent technology, which underpins cryptocurrencies and even digital everything, here is about as good an explanation as I have seen, via Investopedia: “Blockchain Facts: What It Is, How It Works, and How It Can Be Used”:
“What Is a Blockchain? A blockchain is a distributed database or ledger that is shared among the nodes of a computer network. As a database, a blockchain stores information electronically in digital format. Blockchains are best known for their crucial role in cryptocurrency systems, such as Bitcoin, for maintaining a secure and decentralized record of transactions. The innovation with a blockchain is that it guarantees the fidelity and security of a record of data and generates trust without the need for a trusted third party.”
“One key difference between a typical database and a blockchain is how the data is structured. A blockchain collects information together in groups, known as blocks, that hold sets of information. Blocks have certain storage capacities and, when filled, are closed and linked to the previously filled block, forming a chain of data known as the blockchain. All new information that follows that freshly added block is compiled into a newly formed block that will then also be added to the chain once filled.”
“A database usually structures its data into tables, whereas a blockchain, as its name implies, structures its data into chunks (blocks) that are strung together. This data structure inherently makes an irreversible timeline of data when implemented in a decentralized nature. When a block is filled, it is set in stone and becomes a part of this timeline. Each block in the chain is given an exact timestamp when it is added to the chain.”
“How Does a Blockchain Work? The goal of blockchain is to allow digital information to be recorded and distributed, but not edited. In this way, a blockchain is the foundation for immutable ledgers, or records of transactions that cannot be altered, deleted, or destroyed.”
Cryptocurrency, digital money, and tokens, simply explained
Blockchains are decentralized, spread across a specialized network of public or private computers (network nodes). Each node has a current copy of the full blockchain, along with the power to update it. The network design provides incentives for nodes to make updates to blockchains in the form of digital tokens or cryptocurrency – called crypto mining. This is how crypto coins are created. A more detailed story can be found here and here.
Tokenized assets – digital everything, simply explained
Tokenization is the process of representing something real with a unique digital data version. When you buy a crypto coin, you are buying only its digital representation – a token – in exchange for real money. Assuming that any money is actually real. Why would you want to do such a thing?
Well, one reason would be speculation. You want to bet that the crypto price will increase and that you can sell your cryptos (tokens) for a fat profit. Maybe, unless you bought FTX cryptos, as explained in the prior post. Blockchain machinery handles all of the transaction details, securely (sort of), transparently, (sort of), and decentralized (sort of). Gives you a warm fuzzy feeling, yes?
Central banks are into the digitization of money by means of Central Bank Digital Currency (CBDC) that they issue as a new type of government fiat currency. CBDCs are tokens that they give you in exchange for “real” fiat money, like cash or your bank deposits. For more detail on the crypto vs. CBDC story, see here.
Beyond these, things get complicated rather quickly. Turns out you can now tokenize non-physical assets as well as physical assets. Banks can tokenize for safeguarding sensitive and confidential information such as credit card numbers, personally identifiable information, and financial statements. Such non-physical information assets, which track vital change data, can be tokenized to secure and manage the related blockchains.
Real estate, works of art, and even a production batch of Scotch whiskey can now be tokenized and managed by blockchain technology. There are two types of such assets and their associated tokens: fungible and non-fungible. Gold tokens are fungible tokens because they are readily exchangeable at a known value. Real estate assets are unique and can be transacted only using non-fungible tokens (NFTs) unless you are so out-of-the-mainstream and prefer old stuff like cash. For more than you probably ever want to know about such tokens, see here.
So much for the fun side of digitization and tokenization. Now for the scary stuff…
DAOs can be tokenized and blockchained
You may recall from above, this WEF statement: DAO in its essence … is simply another set of mechanics for organizing group efforts, keeping track of whatever needs tracking, and allowing participants to interact via rules called a “smart contract”. In other words, tokenized DAO entities (aka assets) that are managed by blockchain technology.
From the WEF’s DAO toolkit Conclusion: “DAOs are engaged in nothing less than an experiment to reimagine how we all connect, collaborate and create.” Mostly using digital technology, and rules embedded in smart contracts.
What an amazing concept and platform for bringing the world under computer- and AI-based control, not to mention fully surveilled.
This might in fact explain the WEF’s odd but very strong interest in things DAO.
Could reimagining our world bring much of it into a DAO format?
Having interactions handled increasingly by DAOs and blockchains could possibly reduce the need for a whole bunch of real people who create, facilitate, track, transact, and such. Especially if AI gets built into most or all of the smart contracts. Who needs people?
Might the WEF be already on the road to collapse?
The recently concluded Davos 2023 meeting was reportedly subdued, especially its chief and Bond-villain-wannabe Klaus Schwab. Uncharacteristically, he made a very short opening speech. The theme of the meeting – ‘Cooperation in a Fragmented World’ – was not featured in this address.
I recently stumbled across a 79-page (PDF) list of Davos attendees, supposedly leaked, that contains names, titles, and affiliations. Authentic? Who knows, but if you do a quick tally of the names, there are almost 1,900 in total, about 7% of which appear to be government types. The remaining 93% are corporate and NGO people. There are reports that actual attendance was only around half of those registered.
Missing from the meeting were serious bigshots like Xi Jinping, Joe Biden, Vladimir Putin, George Soros, Bill Gates, Donald Trump, King Charles, Prince William, Narendra Modi, Janet Yellen, Emmanuel Macron, Rishi Sunak, Elon Musk, and Georgia Meloni. Even Schwab’s “advisor” Yuval Noah Harari is now absent from the WEF website, whose rather startling quotes were noted in a recent post.
Something seems to be amiss in WEF-world. None of this would likely occur if its world domination agenda was still on track. Government leaders appear to be backing away. Perhaps these are signs of a coming collapse?
Much is happening right now that signals a big event or situation
I am seeing so many reports recently of all kinds of strange happenings. The WEF-Davos note above is one of these. One of my favorite sources for “outlier” views is Hal Turner. As I have mentioned in previous posts, my approach to figuring out what is going on in complex, unclear situations is to dig out views on either extreme. While neither of these views is likely to be correct, they serve to place useful bounds on what might actually be going on. Here is an example:
From Hal Turner on January 24: “Trading Halted In New York Stock Exchange After Opening Plummet – ‘Glitch?’”:
“At the 9:30 AM opening of the New York Stock Exchange today, Tuesday, January 24, a number of VERY LARGE stocks suddenly PLUMMETED at least twelve percent (12%) triggering Regulatory Halting of trades in those stocks. Huge corporations like Exxon, AT&T, Verizon, Wells Fargo Bank, Morgan Stanley, and also some 40 other stocks on the S&P 500, all had to be HALTED by market regulators. Something big seems to be up . . .”
Digital everything seems to be taking shape extremely fast – from blockchain technology to a new form of connection, governance, and transaction management (DAOs). Klaus Schwab and his World Economic Forum (WEF) are prime drivers of DAOs, which is to me very troubling. This may well be the WEF’s way of implementing its Great Reset and Fourth Industrial Revolution grandiose schemes. The WEF’s current power and resources globally suggest that they might actually succeed. I find such a possibility almost terrifying.
- The WEF is not shy about displaying its goals, mechanics, and affiliations. A very troubling, to me at least, example: MolochDAO in the DAO Toolkit extract below, under “Philanthropic”:
“Whom Do You Serve? The future of humanity requires the sacrifice of your shallow desires, but its reward is the head of Moloch himself. This demon god of coordination failure, who consumes our future potential for perverse immediate gain, will be slain. Pledge your oath to his demise, or go down with him.” — MolochDAO, a Decentralized Autonomous Organization
“Moloch, also spelled Molech, a Canaanite deity associated in biblical sources with the practice of child sacrifice.” — Encyclopedia Britannica
- Doron Fagelson offers a broader view of the DAO situation in DataArt: “A Sober View of DAOs: Intrinsic Risks and Hazards”:
“Legal and Practical Hurdles. DAOs are not yet fully recognized in a legal sense. In fact, currently there are only two states in the United States that do formally recognize a DAO as a legal entity with limited liability: Wyoming and Vermont. For the rest of the states, as well as most legal jurisdictions outside the USA, there are legal questions around DAO ownership and liability. Such as: to whom are the actions of a DAO attributed to? Should a DAO file and pay taxes or be compelled to sign legally binding contracts? Are smart contracts an adequate substitute for legally binding contracts? These are just some of the questions in the legal realm that need to be addressed.”
“DAOs also face practical impediments in how they interact with the world. As crypto-native entities, they are hampered by the disconnect between the crypto world and the physical world. Exactly how to bridge this disconnect is very much still an open question.”
“For example: how do you ensure a physical artifact like the U.S. Constitution, a painting or a rare book is in fact governed according to the will of the token holders? In grappling with this question, ConstitutionDAO had the idea to move the DAO into a 501c3 legal structure so that the by-laws would require the directors to act in accordance with the will of the DAO token holders. To take another related example: if your legal status is not clearly defined under the law, how do you bid at a public auction? ConstitutionDAO circumvented this issue be relying on an intermediary – Endowment – to represent them and bid on their behalf at a Sotheby’s auction. These are just a couple of examples of the myriad ways in which DAOs are ill-equipped to deal with real world encounters and interactions.”
- BanklessDAO, a monthly legal journal covering the crypto-legal space, addresses some of the challenges facing DAOs at this point in time: “Decentralized Autonomous Organizations | Decentralized Law”:
“It’s hard to avoid the narrative that decentralized autonomous organizations are everywhere and will change everything, forever. Whether you believe that or not, it’s undisputed that before the bear market, DAOs were growing exponentially, as were the number of articles written about them.”
“Among the many DAO-related articles shipped this year by Bankless Publishing, you’ll find the following titles: DAO Governance Primer, Beginnings of the InDAOstrial Revolution, DAOs v. Corps Is the Trial of the Century, DAOs Unlock How We’re Made to Work, Wen DAO? Roadmapping the Path to Launch, Wyoming Opens its Doors to DAOs, and, of course, DAOs Will Change Everything.”
“Last winter, mainstream media caught on to our little secret, publishing articles such as: The Promise of DAOs, the Latest Craze in Crypto, Why Your Group Chat Could Be Worth Millions, and DAOs Aren’t A Fad — They’re A Platform. While we don’t know what the future holds for DAOs, we do know they are here to stay.”
“We could generally define a decentralized autonomous organization as a digital-native, distributed, purpose-driven organization, which, to varying degrees, leverages the unique characteristics of the blockchain to organize and incentivize activity via new systems of social coordination. Although it can sometimes be hard to know when an organization is a DAO, to paraphrase a famous U.S. Supreme Court opinion, you know it when you see it.”
“But the same cannot be said for the laws and regulations affecting DAOs and their contributors. While there is a robust body of literature about DAOs, there are so far only a few legal articles dedicated to the subject, including those published by Decentralized Law. Unlike DeFi, DAOs have yet to come within the crosshairs of regulators and lawmakers, and most DAOs continue to operate more or less oblivious to their legal status or which laws and regulations might affect them.”