Why 2019 Will Be The Year Of The DAO

6 Trends Likely To Drive Experimentation With Decentralized Organizations

We’ll be talking about this and much more at AraCon, the Aragon community’s first ever large event happening in Berlin at the end of this month.


One story in crypto is the price story — how speculative investments in cryptoassets are performing. In 2018, that story wasn’t so positive, seeing a massive return to earth after 2017’s run up broke gravity.

Another part of the crypto story, however, is the evolution of the underlying tech stack. Still another is the broader global social context that creates a need for those decentralized, censorship-resistant technologies. In those contexts, 2018 tells a very different story.

At Aragon, we sit at an interesting vantage point, not only developing technology but getting to watch as hundreds of projects and organizations start to build on top of that technology. From where we sit, 2019 is poised to be the year of the DAO. Here’s why.

DAOs: What Are They Good For?

First, by way of set up, let’s quickly review some of the characteristics of decentralized organizations and the use cases that those characteristics suit them for.

Decentralized organizations are good at:

  • Coordinating resources when not all parties know one another (or don’t know each other well enough to trust one another deeply)
  • Aligning large numbers of stakeholder contributions towards shared goals
  • Running organizations in a way that is resistant to censorship
  • Tracking and validating participation and contribution to a project
  • Accommodating a variety of levels of contribution
  • Allowing people and entities to contribute work in a jurisdiction-agnostic fashion, regardless of the rules of the physical location where they’re contributing from
  • Nimble setup, especially relative to traditional organization structures

This set of characteristics lend themselves to huge numbers of possible use cases, but a few broad categories that stand out as most relevant are:

Businesses constrained by the existing system, in terms of things like complication around the nature of contributions (i.e. difficulty of fitting people in the box of employee, contractor, etc); jurisdictional issues (i.e. the challenge of operating globally in anything resembling an efficient manner); or regulatory issues — which doesn’t necessarily mean that the business is doing something nefarious, but more that regulation in its jurisdiction hasn’t caught up yet.

Social and political movements that have a mismatch between their reality — which can be highly dynamic, temporary, and built around small diverse actions from a wide variety of contributors — and the organizational forms available to them, which tend to assume long-term existence, similarity of contribution, and fixedness of purpose over time.

Networks such as online communities that start as informal but who wish to be able to coordinate more formal, tangible action.

Global Trends Incentivizing DAOs

Once we understand what DAOs are useful for and what types of organizations they tend to beget, the next question becomes what are the global macro trends that would lead people to want to build those types of organizations or have those types of use cases? A set of trends stand out.

Globalization Of Talent & Transformation Of “Work”

There are actually many dimensions of how global work is changing but two stand out as it relates to the emergence of DAOs. The first is that talent is more global than it has ever been. As businesses try to recruit that talent, they face massive jurisdictional and regulatory headaches as the current legal system was not organized to accommodate transnational workers. This creates a major financial incentive to organize global work differently.

Another dimension of the changes in work is the nature of what work itself is. In the industrial era and even so far in the information era, “work” has still largely fallen under employment or contract buckets. But what happens when units of work are micro contributions of time, data, processing power etc that don’t fit in any previous legal framework? As new decentralized digital infrastructure is being built, it is exactly these types of “work” that are coming to the fore. New types of work require new modes of organization.

Well-Resourced Stakeholder Networks Needing Coordination

The last few years saw significant financial resources flow into decentralized, open source project ecosystems. These ecosystems promise a different way of doing business to their contributors, including more transparency and even stakeholder empowerment around how those funds are used. These sort of stakeholder-driven communities already need tools for coordination, and this need is significantly increased when those communities are charged with allocating millions of dollars.

Emergence of Decentralized Finance

One of the most important growth and usage stories in crypto last year was the emergence of open, decentralized finance protocols. Today, hundreds of millions of dollars are locked up in permissionless loans and collateralized debt products that simply couldn’t have existed a few years ago. These decentralized finance tools are creating entirely new categories of business opportunity. At the same time, however, these opportunities exist in a total regulatory gray area, so many are turning to DAOs as a sandbox to experiment outside of traditional organization models.

Normalization Of Participation In Governance

People’s expectations are shaped by what is normal and familiar to them. In line with the growth in resources for open source stakeholder communities, there is also a growing belief that stakeholders should have a hand in guiding the decision making of those communities. As governance experiments both on-chain and off-chain become commonplace, the net aggregate impact is the normalization of participation. In other words, the more people are invited to participate in decision making around the communities they belong to, the more they come to expect that right. This creates motivation for organizations to have systems to incorporate the voices and perspectives of their stakeholders in a more direct and routine way.

Deplatforming Grows As An Issue

For much of the young history of Web3, questions of censorship of centralized social platforms were more theoretical than real. We understood, increasingly, that we had lost control of our data, with its own set of consequences, but there wasn’t yet much evidence of platforms asserting editorial control over who could and couldn’t participate. Early in 2019, however, deplatforming has emerged as a more significant issue, with numerous theoretically uncensorable alternatives to social media and fundraising platforms emerging. Whether this is a real issue or a political football and feigned controversy remains to be seen. However, what’s for sure is that a number of prominent voices are using their bully pulpits to put it in the spotlight.

Upswing In Political/Social Organization

The last few years have seen a decided upswing in global social and political action. Importantly, this is not just a phenomena of the developing world, but is sweeping the Global West as well. From Brexit in the UK to the election of Donald Trump in the US to the #MeToo movement to the Yellow Vests in France, the world is heaving. As discontent rises, people are looking for ways to channel that frustration into action. It seems likely that as better coordination tools become available, they’ll find a ready audience with those who want to transform the world around them, and don’t have time to wait for bureaucratic organizations to catch up.

Putting it all together

If these trends are driving interest in and need for DAOs, the next question is who is creating the technology infrastructure to actually experiment with new forms of organization?

While it is still very early days, 2019 is kicking off with significant energy in this direction, including dedicated DAO platforms, applications built for those ecosystems, and even protocols experimenting with decentralized governance.

When it comes to new forms of work and organizations, in many ways the entire blockchain space is an experiment, as mining, validating, staking etc all represent new forms of work that are absolutely vital but quite new. The large and growing conversation around “generalized mining” is reshaping how we think about organizing businesses around these types of work.

Other examples of projects playing in the sandbox of new forms of working include Gitcoin, which allows the open source community to incentivize and monetize their work; Espresso, a decentralized datastore that integrates with aragonOS to let DAO teams share files without relying on Dropbox or Google Drive; and Planning Suite, another Aragon app offering a collaborative planning model enabling multiple different groups of stakeholders within an open source or decentralized organization to coordinate the use of shared resources. Finally, one of the most interesting projects in this space is Pando, which actually transforms creative projects that have multiple collaborators — from books to music to video games — into DAOs.

With regard to stakeholder networks needing coordination, there are a number of projects at varying levels of development. Giveth, for example, is creating an architecture for Decentralized Altruistic Communities, an alternative to traditional nonprofits that allow people to organize around causes and collaborate to allocate resources. Another buzzy-but-not-yet-launched project in the space is Moloch, an open source approach to allow communities to fund shared infrastructure, with more information purportedly coming at ETHDenver in February.

Examples in the Decentralized Finance space are incredibly numerous. MakerDAO is an increasingly important piece of the puzzle, with more than 1.75% of ETH locked as collateral in Collateralized Debt Positions of CDPs. Compound Finance allows token holders to earn interest on their tokens. Dharma is building a protocol for credit on blockchains that can support numerous types of lending products. In short, DeFi is one of the most exciting areas pushing the boundaries of how you can reimagine organizational structures even in key market activities.

In the realm of governance, 2019 is posed to see a Cambrian explosion of experimental governance models move from theory to practice. 0x is in the midst of a transition to community governance. At the end of last year Melon unveiled more about its proposed governance approach. These represent just some of the approaches that will allow us to learn and see how decentralized governance works in practice this year.

Deplatforming is also in an interesting trend as it relates to real action. There are, of course, some prominent alternatives to incumbent social networks — such as Gab and Mastodon both trying to create alternatives to Twitter. More recently, there have been some announcements about projects that seek to replace Patreon and Kickstarter. And just in the last week or two, 0xchan was announced, which includes developers who worked on POWH3D. In short, it should be an interesting year for decentralized alternatives to social media and funding platforms.

Finally, when it comes to political and social organizations, the use of DAOs remains to be seen. There are some projects working on infrastructure, like Giveth mentioned above. The exciting thing to see, however, will be whether emergent political and social organizations in the numerous relevant contexts around the world, from Rojava in Syria to the 2020 US election cycle to the Venezuelan crypto community, will turn to tools like Aragon and the apps in its ecosystem as they come online.

In short, when you look at both the trends pointing in their direction and the infrastructure around DAOs that is quickly coming online, it’s hard not to be excited about the possibilities for the year(s) to come.

If you’re interested in these topics, we encourage you to check out AraCon, the Aragon community’s first ever large event happening in Berlin at the end of this month.

Thanks to John Light, Nathaniel Whittemore, Luis Cuende, Lucija Matic for the many inputs.

Decentralized organizations are the future: why I’m joining Aragon

A personal journey towards decentralized organizations

For some reason, I’ve been thinking about autonomous, decentralized organizations since 2013.

Corporations today look exactly the same as the Dutch East India Company: a piece of paper with some rules written on it. There’s no “actual” corporation, as Yuval Noah Harari would say, it’s just a nice shared fiction that we create and believe in.

To create one, you have to spend thousands of dollars on lawyer fees, beg banks to open an account for it, pay tons of taxes, only to get some pieces of paper that only work is a specific jurisdiction!

Corporations have been the core driver of innovation from the industrial revolution till today, and to think that they haven’t evolved at all is just plain crazy.

This essentially means that the amount of innovation in the world today is constrained by these antiquated legal structures.

So, since 2013 I’ve been thinking about how to solve this problem, and this is the story of how this process brought me to Aragon today.


Let’s do a quick detour to the summer of 2011, soon after landing in SF, as I pushed my way into a test day at a small startup few people had heard of at the time. They were not hiring for the role I wanted and didn’t for years to come, but I had a magnetic pull to it.

So I joined 7 or 8 people in a Hacienda-looking cute small house in downtown Palo Alto for a day. Most of them were from MIT and wicked smart. Two were crazy Irish teenage brothers, who had founded it.

The company was Stripe and the feeling I had while being there is the reason this post is starting with this little anecdote, which I’ll come back to later.


But the real story begins in April 2013, when I opened up a fresh new blank Google Doc and started typing: BitCorp.

You can tell my first kid was just a few weeks old

The idea was as simple as it gets:

A new framework for creating modern, anonymous corporations.

BitCorp enables anyone to create a digital corporation, not bound by any sovereign legal and fiscal framework. The corporation’s activities are run in Bitcoin.

The idea came to me because of how hard and expensive it was to create new companies for small projects and collaborations.

This was a period when I was extremely interested in Bitcoin (and had been since 2010) and its future potential both as the default SoV as well as a permissionless financial transaction tool.

The features I had in mind where also very simple:


  • Create a corporation (Decide number of shares, Assign first shares to users, Create roles (CEO, Board Members))
  • Hosted company Bitcoin account
  • Issue new shares
  • Receive investments
  • Define voting and control rules (“xx% of common shares votes needed for transactions higher than xx Bitcoins”)

POST MVP features included of approval of enforceable budgets, shares classes and even an IPO Market. Turned out I should have called it an ICO market, but who could have known 🤷‍.

What wasn’t simple was the implementation of all of this.

Screenshots from my Elevatr app notes

This is still 2013, the ideas of Colored Coins and smart contracts are starting to float around, but there is still obviously no Ethereum on the horizon, and even though I had graduated in Computer Engineering, my coding is limited to Rails scaffolded web apps.

This means that my only possible implementation is that of a centralized web app that fundamentally operates around a shared Bitcoin wallet. But centralization, when building things at the edge of old-school regulations, means a guarantee of shutdown or worse.

So, aside from chatting about the idea with a few people in Cafe Centro, I mostly park it.

2015, not quite there yet

A cold email from a fellow Sandboxer makes the idea resurface: this young Argentinian guy wanted to build something very close to my original idea, using the blockchain to time-stamp and proof data, he called it BitCorporations.

The time was still not right yet for this idea to work though, and after a while they decided to abandon the project. Fortunately, they turned all of their work into what today is Zeppelin!

In the meantime, I had participated in the Ethereum pre-sale and saw it go live, but I was running a startup and a small fund at the same time, so couldn’t focus too much on it. But it was clear that it was the future.

2017, discovering Aragon

Fast forward to one day in early 2017, when I discovered Aragon, a project started by a couple of Spanish teenagers who were building exactly what I had in mind, and doing it the proper, decentralized way — with very little regard for the status quo, and a naivety about the scope and difficulty that only young idealists can have.

View at Medium.com

After following them for a bit, it turned out that Jorge was an incredible developer with a mind wired for decentralized organizations (as can be seen in his early posts) and Luis was an idealistic leader who just couldn’t function in a world run by centralized organizations.

The potential of the team was as clear as it can get.

In May 2017 I participated in their token sale, and continued to be a fan and friend ever since finally meeting Luis live at the first Unplug retreat.

2018, the execution year

This year was quite spectacular for followers of the Aragon project, with continued product shipping, culminating with their recent mainnet release.

Contemplating the fact that today it’s possible for anyone in the world to spin-up a decentralized organization thanks to aragonOS (a marvel of smart contract engineering) and the Aragon client app, is pretty mind blowing.

Aragon is live, and you can create organization with shares, shared finances, custom permissions, votes and more

There are infinite articles or examples that can be used to explain just why this is one of the highest quality projects I’ve ever seen, but to me, two of the most telling signs of Aragon’s pioneering in this new decentralized world are their extreme transparency focus and their announcement of the decentralization of its development.

Aragon is setting the standard in transparency, with all of its expenses and treasury movements made public as well as a direct view into the treasury wallet at all times.

And it is setting the standard in decentralized governance and development as well. It is the first team to intentionally explode itself into a decentralized network and actively incentivize other teams to collaborate (and maybe even compete in the future) with itself by providing them funding.

View at Medium.com

Luis and Jorge want Aragon to be around not because it’s their baby, but because it’s important and needs to exist in the world. And I share that feeling.

The future

Back to the 2011 Stripe story: the only time I’ve ever re-lived that 2011 feeling was when I visited the Aragon team in Zug a few weeks ago.

Sitting with Patrick, John, Billy, Greg (who went on to co-found OpenAI) and the rest of the Stripe team, it was clear that they were about to transform the online commerce world and with it unleashing a whole new wave of innovation.

Listening to Luis and Jorge explain the Aragon core infrastructure and what its future looks like felt eerily similar, and I think speaks to the quality and potential of this team.

(I also don’t think it’s a coincidence that Stripe ended up playing in the same space with the launch of Atlas.)

I think that Aragon is one of the most important projects that have come out of the decentralized computing movement in the past few years, with a clear potential to radically transform how people interact, collaborate and transact in the real-world.

In the 21st century it is frankly absurd to be living in a world made of borders and barriers.

I envision a world where people all around the world can collaborate and transact in freedom, where capital is not the chief divinity ruling all of our lives and environments, where we let go of elites and aristocracies and where stupid barriers to progress and innovation are torn down when they stop making sense.

Organizations should be spun up and wound down as needed. They should be extremely flexible, being able to implement any type of governance. They should be global by default and not bound by any rigid legislature.

Anyone, anywhere in the world should be able to spin up a cooperative, corporation, association or any other type of organization and use it to collaborate and transact with other people around the world.

People should be able to do so in low-trust environments, with the guarantee that what’s encoded in the software can’t be changed, and that in certain situations final judgment can be delegated to a 21st century court system.

And as we move towards an AI-infused world, it’s also likely that different AIs and smart objects will need structures to interact with each other.

As you can see, the amount of innovation that Aragon can unleash is limitless.

Helping Aragon for me means helping move the world towards what it should actually have been for a while already, and I couldn’t be more excited to join the Aragon Association as its first Executive Director.

The Aragon Association’s mission is to ensure the development of the Aragon Network. Specifically, this means managing its treasury and funding teams to build out the core parts of the ecosystem.

We already have two teams building on it, and are looking for more.

You can think of this role as a temporary overseeing of the Association’s activities and treasury, while we figure out how to render it completely irrelevant (like every other physical jurisdiction-bound paper-based legal entity) and transition all of the governance to the Aragon Network itself.

I will be hiring a small team to make sure all of this happens, so if you are as excited as I am about the potential for decentralized organizations, you should reach out.

Additionally, we are organizing the first ever Aracon in Berlin in January, and that’s the perfect place to come learn about how organizations will work in the future and what you can build with Aragon today.

Transparency disclosures: I own ANT from the original token sale, which I never touched. I will be receiving a (small) amount of ANT as part of this new role, and I have also been buying some ANT off the market recently.

I will continue my investing activities, which include investing in European venture capital funds for a family office; in impact deals as an angel investor; and in in teams building the future of decentralized computing through Semantic Ventures as a venture partner and advisor.

I will also continue writing Token Economy and organizing Unplug.vc events.