gm Good Contributors! 👋🏼
Imagine you're the CEO of a multi-billion dollar company, and your employees decide to cut your salary in half. Welcome to the world of DAOs!
Today, we're diving deep into the world of DAO Councils. Are they the solution to governance inefficiency in DAOs?
Let's explore this fascinating topic.
📈 DAOs Market Brief
💊 What Are DAO Councils?
A DAO council is like a team of dedicated contributors within a DAO who are chosen by the community. DAO councils can be likened to the steering committees in traditional organizations but with a decentralized twist.
These groups are made up of people chosen by the wider DAO group to handle important tasks. What they do includes:
Making Choices: Members of the DAO council make big decisions for the DAO.
Representing the DAO: They communicate with other organizations on behalf of the DAO, forming deals and partnerships.
Resolving Disputes: If there's a disagreement within the DAO, the council members step in to help sort things out.
Evaluating Proposals: They look over new ideas before the whole DAO gets to vote on them, checking if they're practical and beneficial.
Managing Finances: They take care of the DAO's finances, making sure the money is spent wisely and keeping an eye on the budget.
Overseeing Daily Operations: The council manages everyday activities to ensure the DAO functions well, like monitoring project progress.
Strategic Planning: They plan for the DAO's future, thinking about what directions to take and preparing for possible risks and chances.
Each DAO has its unique process for picking these council members, often through a voting system. The specific duties of these councils can differ greatly, tailored to what the DAO aims to achieve and needs.
Case Studies of DAO Council Structures
SuperRare
A 7-person governance council controls the SuperRare DAO Community Treasury via a 4-of-7 multi-sig wallet.
The current members of the Governance Council are:
Council signers execute decisions made through governance but cannot independently allocate treasury funds. Although the initial Council members were pre-selected, $RARE holders have the power to replace them through governance.
Learn more about SuperRare governance here.
Friends With Benefits (FWB)
The Community Council at FWB is chosen by members voting for their favorite candidates in order of preference.
The council has 5 people from different jobs like building, marketing, and law, who make sure the group's decisions match what everyone wants.
The current members of the Governance Council are:
Setting up this council is a big deal for FWB, making it more member-driven and connected.
⬅️ Recently
The DAO Council for Arbitrum has been chosen.
➡️Upcoming
The DAO Council for Ape Coin DAO will be elected.
How to be a member of a DAO council?
First you need to be a DAO Contributor, obviously.
Then, to get on a DAO council, try these steps:
Keep a List of What You Do: Write down your work for the DAO, like suggestions you’ve made or tasks you’ve completed.
Get Good with the DAO’s tools: Learn how to use the websites and apps where the DAO makes decisions.
Learn the Basics of Smart Contracts: Understand the digital contracts that run things in the DAO.
Stay Updated: Keep an eye on news about the kind of business the DAO is in and the blockchain stuff it uses.
Make Friends: Chat with people in the DAO and join groups or discussions online.
Share Your Plan: Tell people what you want to do for the DAO and what you’re good at.
Join Meetings: Show up and participate in the DAO’s group calls or meet-ups.
Understand the Token Game: Know how the DAO’s digital money works and how it affects.
“With great power comes great responsibility.”
Please note that this newsletter does not provide legal advice. For assistance with the legal aspects of establishing a DAO Council, we recommend consulting with MiDAO. Their expertise can guide you through the necessary legal frameworks.
For more information, visit MIDAO.
Last Thoughts
Having a DAO Council can be a great idea because it brings leadership and expertise to the table, which almost any organization can benefit from. Even the Jedis have a Council.
Good leaders can navigate complex challenges and keep the DAO focused on its long-term goals. If the council operates transparently and can be changed based on performance, it doesn't necessarily go against decentralization.
On the flip side, a council might seem to go against the idea of full decentralization if it ends up holding too much power. The key is to design the council so it's accountable to the DAO's members and doesn't block others from participating in governance.
The recent decision by ApeCoin DAO members to cut the council's pay by 50% shows the democratic nature of DAOs in action. But could this deter highly skilled individuals from participating? Would a company like Apple have succeeded if its marketing strategy was decided by user votes instead of Steve Jobs? It's a complex debate.
For now, I lean on Machiavellian principles for efficient DAOs.
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