gm Good Contributors! 👋
DAOs are great, but make no mistake, there are still a lot of complicated things to figure out.
We keep hearing about DAO hacks, rug pulls, and government snoops.
It's enough to make you doubt things.
With the help from Web3IsGreat, we'll be looking at the biggest DAO failures of 2023.
Let's go for it!
📈 DAOs Market Brief
💊2023: A Year of Challenges and Lessons
Check out these real-life lessons for DAOs as they navigate the complex world of decentralized governance and legal compliance:
Problem: Conflict of Interest and Mismanagement
Solution: Aragon DAO should have established clearer guidelines and oversight mechanisms, promoting transparency and regular audits to avoid unilateral actions by the Aragon Association.
Problem: Lack of Sustainable Funding
Solution: Superdao could have explored alternative funding models like token-based revenue sharing or strategic partnerships for long-term sustainability.
Problem: Governance Disputes
Solution: Nouns DAO needed a robust governance framework and dispute resolution mechanism to prevent community conflicts and splits.
Problem: Team Control Over Governance
Solution: Party Parrot should have implemented time-based vesting schedules for team tokens to ensure fair governance.
Problem: Smart Contract Vulnerability
Solution: Azuki DAO needed thorough smart contract audits and a bug bounty program to identify and fix vulnerabilities proactively.
Problem: Regulatory Compliance
Solution: Ooki DAO should have followed KYC and AML processes and consulted legal experts for regulatory compliance.
Problem: Governance Manipulation
Solution: Tornado Cash DAO should have enforced stricter governance controls, requiring multi-signature approvals to prevent hostile takeovers.
Problem: Smart Contract Bug
Solution: Aave needed extensive testing and audits on Polygon to identify and fix bugs before they jeopardized user funds.
Problem: Lack of Transparency
Solution: Aragon DAO should have communicated its transition plan transparently to maintain community trust.
Problem: Fund Misappropriation
Solution: Ukraine DAO required robust financial controls and audits to prevent misappropriation allegations.
Problem: Governance Mismanagement
Solution: Arbitrum should have defined its DAO's purpose and governance procedures before allocating tokens to prevent confusion.
Problem: Data Security and Malicious Activity
Solution: PeopleDAO should have used secure tools for payment processing to prevent data exposure and tampering.
Final Thougts
Saying DAOs don't work is like claiming ships couldn't sail back in the viking days.
Yeah, those early ships had their fair share of sink parties, but guess what?
We need more "Flokis" in space, the kind of folks who build stuff like crazy.
And we need some "Ragnars" who aren't afraid to sail into the unknown.
Just like those old longships eventually evolved into modern giants like the Maersk Triple E, capable of transporting... Well, a ton of loot!
So, let's not chicken out on DAOs; Instead, let's embrace the revolutionary spirit and keep pushing the boundaries, just like our seafaring ancestors did.
👀 Visualize
Calling all artists or anyone who knows an artist interested in joining a DAO! Get ready for some inspiring content.
Check out this article to discover how DAOs can help artists.
💪 Keep Trying!
Big news: I've left Unlockd. No problem. I'm actively seeking new opportunities and freelance gigs. Feel free to DM me if you have any leads.
As a stoic, this doesn't slow me down one bit. Big shoutout to the Unlockd team for the invaluable learning experience. Wishing them mad success in their future ventures!
While I pursue my new goals, I'm back with BanklessDAO and conducting interviews for my personal project Anti Secret Society (Check out my chat with Nate Hill—it's a good one!)
Plus, I'm leveling up my skills to become a “DAO Cartographer”, diving into:
Damn! I swear, anyone who takes all these courses is guaranteed to land a job!