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.

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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.

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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 events.

We need more public due diligence for ICOs

It’s a new world out there.

As investors, we’ve been used to a private fundraising framework that is being completely turned upside down by the public token sale mechanism.

As a venture investor, evaluating investment opportunities is often your full-time job and decisions impact your career as well as your wallet.

As a venture investor you’re also always given access to a lot of detailed confidential material and the access to the team, in order for you to ask questions. And even if in Silicon Valley deals close in record time, and at the seed stage you have to move fast, for Series A+ you have basically as much time as you want to make an investment decision.

Often, as a venture investor you’re also given information rights and sometimes board seats (even thought we’ve recently seen in many companies that in terms of preventing bad behavior these are fairly useless).

In the ICO world, that’s not the case.

Companies, teams or organizations that lunch public token sales, most often never interact with the final token buyer, and the average token buyer has no way to contact the team other than Twitter or their community tool of choice.

On top of that, ICOs are often on extremely tight deadlines, and are surrounded by a lot of hype.

It’s also usually more technically complicated to due diligence such efforts as code is law, and to fully appreciate what’s going on you need to read and understand the smart contracts behind an offering or the code behind a new protocol.

Given that the fundraising efforts are public plus there is little info and little time, I do believe the diligence efforts should be public as well.

When venture investors see deals they don’t like for some reason, or terms that are not fair, they just pass on the deal, and that’s it.

Because other investors will still be full-time investors that will go through the same process of analysis and diligence, and someone might like the deal. (Oftentimes VCs also interact offline about specific deals to get feedback and ask for things they might have missed, especially in advanced diligence).

In a public fundraising deal, even if reserved for accredited investors in the first phase (the token will reach exchanges sometime), investors aren’t usually full-time professional token investors.

Not everyone has time to dig into whitepapers (let alone understand them) and token sale economics to make a very informed judgment.

Yesterday, I did such an effort given no one would write about it. I wrote my sentiment on the token sale economics of Filecoin.

View at

What has surprised me the most, is that aside from a few notes of dissent and criticism, there has been an overwhelming and amazing reaction online.

This post seems to have changed the perception of the token sale for people, which must mean that they did not know the facts presented in the post. This in interesting because those facts were just hiding in plain sight on the token sale documents. In turn, this means that people are very prone to the hype machine but not many have the time to actually go read and ponder about specific token sales.

This is wrong. But to me it should hardly be surprising: I certainly participated in a few token sales where I did not have much information or insight!

I would surely have loved if someone reported on what they found in the docs (and even more importantly the code) for other projects.

I would have loved if Emin Gün Sirer had started the public conversation with The Bancor Protocol before their token sale had started and I’m sure many others would have as well.

View at


If you do spend your time looking at projects in the distributed ledger space, please write up your conclusions on projects you understand.

The analysis Filecoin doesn’t want you to read

Digging into the dynamics of Filecoin’s token sale and economy

Filecoin could be a game changer for the crypto space. It’s one of the few projects that are extremely well thought out, built by an amazing team, and actually needed.

Add to that the fact that they created a new proof mechanism and have a legitimate need for a blockchain.

In other words, it’s probably the best that the crypto community has seen recently. It was certainly one of the few ones I was looking forward to.

But then, two things happened:

  1. they released some info on the token sale.
  2. they released some more info in response to anonymous questions from an investor.

Man, I wouldn’t have expected something like this from a solid team. The response felt particularly disingenuous.

I’m now incredibly disappointed, and probably will not participate in the sale.

I’ll also probably lose a good number of friends that are investors in the company and/or pre-sale, but in this new era of completely public fundraising, I think the public deserves to hear it from all sides.

The flaws in Filecoin’s token sale

  1. Filecoin gave an amazing deal to their buddies, just a few weeks ago
  2. Filecoin is being insanely greedy, going out for a $700M+ raise
  3. Early clickers are incentivized, price unknown, network congestion update, see below
  4. Protocol Labs and Filecoin foundation are keeping 2x the coins that investors will get

Problem #1: Filecoin gave an amazing deal to their buddies

There’s nothing that can stop them here, but many people got very mad about this and rightly so.

Filecoin raised $52M in an advisor sale very recently, till July 24th. This sale was reserved for people close to the company and in the industry. Many extremely high profile people participated, total cheques were 150.

These investors paid a maximum of $0.75 per coin. They could also have chosen discounts based on the amount of time the coin would vest, from 0% to 30%.

These investors did not take any more risk than the investors who are going to participate in the public token sale. Actually, one could argue that they even took less risk because they knew what the price would be all the time (which is not going to be the case for public investors)

Their explanation:

All of these people and organizations (a) have been working hard with us for years to make IPFS and Filecoin successful

This is absolutely untrue. Quite a few people just got introduced to the team recently and got into the sale just a week ago and paid the $0.75 price.

(b) have fully committed themselves to work hard with us and for the Filecoin Network for many years to come,

Sure, but you, dear reader, would commit too, wouldn’t you?

c) offer tremendously valuable advice, hands-on help, knowledge, skills, resources, connections, and more.

This is the real reason that they will pay 2x-20x less than you. You be the judge. Usually vested equity is subject to good behavior, but here anyone could promise great advice and help and then disappear, but still get coins.

Problem #2: Filecoin is being insanely greedy

After having raised $52M in a pre-sale for a pre-product offering, they want to go out and raise an amount that is effectively uncapped.

Their response:

Our token sale IS NOT uncapped. It is capped in terms of the amount of Filecoin sold: 200M FIL.

Over the last few years, Protocol Labs has proved to the world that we know how to deploy capital to create valuable projects, valuable technology, and valuable software. To date, all of the work you see — IPFS, libp2p, IPLD, Multiformats, Filecoin, CoinList, and all our research — all our work has been funded by under $3.5M. We know how to deploy capital effectively.

It seems like I’m reading a Trump statement. Basically saying: “I have eaten 10 ice creams in the past years, so I’m great at eating ice creams and can easily eat 1000 in the next few years. Gimme ice creams.”

But aside from the absurdity of trusting someone that deployed $3.5M with $500M+, let’s analyze the USD cap of their token sale.

Some numbers

  • $52M raised in presale
  • Minimum 69M, Maximum 99M Filecoins sold in ICO
  • Advisor max price $0.75
  • 131M-101M Filecoins left for the public
  • Starting ICO price: $1.3 ($52M/40M), almost 2x advisor price.
  • Price at $100M raised = $2.5
  • Price at $200M raised = $5
  • Unfortunately, their price function is not clear. It doesn’t state if a transaction amount impacts the total raised before calculation of price or after. In any case, assuming normal average investments, eg. $100k, this doesn’t change much.
  • The USD cap will change based on the average purchase amount and the average discount chosen by the buyers.

Let’s calculate the Filecoin ICO USD cap

I wrote a small piece of code to calculate the USD raised with different assumptions.

You can see it here:

And you can run it here on the amazing (Mission and Market portfolio company plug! Oh BTW, I deployed $3M with my first fund, maybe I should raise a $1B second fund.)


  • Total Filecoin sold in the advisor pre-sale: 85M (The minimum sold is 69M, if everyone paid $0.75, and the max is 99M, if everyone chose a 30% discount, so I chose something in between)
  • Average investment = $100,000.00
  • Average discount chosen by investors: 10% (discounts are 0%, 7.5% for 1y vesting, 15% for 2y vesting, 20% for 3y vesting — I’m assuming many will choose 0 and a few will choose the rest, so 10% sounds about ok.)

The results

Final price is $15.54075
Raised $690,800,000.0
Total filecoins sold: 199999826.3440984

So effectively the cap of Filecoin’s ICO is ~$700M.

For fun, let’s assume no one chooses discounts:

Final price is $34.34
Raised $1,373,700,000.0
Total filecoins sold: 199997793.51623443

The real cap is $1.37B.

And, everyone max discount:

Final price is $7.83
Raised $391,600,000.0
Total filecoins sold: 199991567.59900582

Highly unlikely, but this is the minimum possible cap.

Call me old fashioned, but wanting to raise half a billion dollars for a pre-product endeavor is absolutely fucking insane.

Let’s remember that the tokens will also come out when the network is launched, which Protocol Labs is estimating at 1 year out. Vesting will only start then.

Problem #3: Early clickers are incentivized, price unknown

Given the price grows as more money is invested, early clickers are incentivized to get in as fast as possible — this has the obvious intention of raising as much money as possible.

Users paying in BTC and ETH will also have to wait for their transactions to confirm before knowing how much they paid. Given a very likely clogging of the network, this has the potential for disaster.

I suggest reading their explanation in the response. It is a mix of funny and scary.

Update: rules have changed. Price will be averaged in the first hour and max price in the first hour is $6.

This means that no one will pay the $1.31 min price and buyers in the first hour won’t know how much they’ll pay in the $1.31-$6 bracket.

When the first hour is over, that’s when people will want to fast click because they’ll have information about the price and total raise.

This update just makes it so that there won’t be any price difference for first hour clickers, which is good, but not great. Price is still unknown (and crazy high compared to advisors).

Problem #4: Protocol Labs and Filecoin foundation are keeping 2x the coins that investors will get

This is absolutely mind-boggling to me.

To compare, the ETH genesis sale gave 10% of ETH minted to early contributors and 10% to the Ethereum foundation. 80% was for investors.

In Filecoin’s case, Protocol Labs will receive all the cash PLUS 50% more coins than investors, so 1.5x. A foundation will receive 50% of the amount of coins “minted” by investors. Total: 66.6% to them, 33.3% to you.

Assuming a “small” $250M total raise, Protocol Labs and a foundation would receive, $250M cash, plus $250M-$300M (remember, the discounts?) in tokens.

Also, 70% of the tokens that will ever exist will be mined. This means that the investors are only getting access to 10% of the total supply ever.

As a comparison, Ethereum sold 60,108,506.26 ether at genesis, and today there are 93,775,666.

Place your bets accordingly.

Quick and dirty utility value calculation

Edit: I’m removing this as apparently it was way off. I’ll try to spend more time, but with token sale in just a few days not sure I’ll be able to, so prefer to just take it off.
All other points I still stand by.


Filecoin is why we can’t have nice things.

A real game changing project, that has always touted they care about the community and would do this for free, is going out trying to raise $700M and keeping double that in coins.

I think this could be one that will be remembered and written in history books about how insane this all was, and how a major innovation like the cryptographic token was taken advantage by people wanting to raise stupid sums of money, before it was really used to the best of its potential.

Thanks to redacted, redacted, redacted, redacted, and redacted for providing feedback on this draft, the ideas behind it, the code and the assumptions for the utility value.

Aligning incentives in ICOs and token economies

In the new frenzy for digital assets, many entrepreneurs are debating if they should raise money through a token offering or not.

The decision is not that simple.

I’ve obviously been thinking non-stop about digital assets and ICOs for the past months, like many others.

In order to have a successful ICO and, most importantly, a smooth and successful development of the project, protocol, token or dapp, the needs and incentives of many different stakeholders (man do I hate this word, if you have a good alternative please let me know) must be carefully balanced.

It seems that many projects are carelessly dismissing this topic and just gunning for the most cash possible. That might make the developers rich in the short term, but makes everyone poorer in the long run.

In my opinion an ICO or token offering only makes sense if it can align incentives between every actor and ultimately make an application more successful than what it could achieve with a normal fundraising structure.

First, let’s see who’s involved in an ICO?

  • Founding team
  • Advisors
  • Future employees
  • Early investors
  • ICO investors
  • Future token investors
  • End users of the dapp and thus of the token
  • Equity holders in the offline-entity

Second, what levers can we act on in an ICO / token design?

  • Total token supply
  • Token allocation
  • Number of coin offerings
  • Price in pegged currency (-> valuation)
  • Minimum rise
  • Caps
  • Distribution schemes
  • Inflation

Third, what does everyone want?

This is probably the hardest question, because right now it seems everyone just wants to make a buttload of money.

But let’s try to figure out what are the things we could maximize:

  • Initial amount raised
  • Future fundraises
  • Token price over time
  • Liquidity of the token
  • Usage of the platform
  • Revenues / dividends collected by token owners
  • Participation from developers and others that can help the protocol

Obviously we can’t maximize all of the above at the same time, but the way we structure token sales and designs can have tremendous impact on the ones we choose.

Unfortunately even the most thoughtful ICO schemes that we’re seeing today are not really thinking that far into the future and only really trying to optimize the distribution and “fairness” of the ICO, which is an important but small part, for it changes very quickly after the ICO.

Let’s try to quickly examine current ICOs schemes:

  • One-time fundraise: so all tokens are distributed at the beginning, often pre-product
  • Some tokens reserved for team
  • Some tokens reserved for advisors / partners etc.
  • Fixed price per token or fixed valuation
  • Maybe a cap on the amounts of tokens sold (-> so on capital raised)

In my view, current token sale models are completely suboptimal as they don’t really maximize ANY important thing!

And specifically only play to the advantages of early ICO investors with some sort of disregard for all of the others.

Let’s see how it fares on all of the dimensions we can tweak:

  • Total amount raised: if there’s a cap, then it obviously doesn’t optimize this. If no cap then you are limiting the amount you can raise by doing one single ICO when there isn’t anything to show for your product.
  • Token price over time: the thinking here goes that by limiting the supply and distributing it all on day-one will make the token value go up in time. This makes some sense, as long as the demand for that token exists and people want to own it, obviously. For that condition to happen there needs to be vast interest in the protocol and the products built on top of it, which are maximized in other aspects and not by supply dynamics. If instead the goal is for price stability over time so that people can use the protocol without worrying of becoming poor, then this clearly fails.
  • Liquidity of the token: giving the token on day one to random speculators on the internet doesn’t guarantee a liquidity in the market, and actually might hinder it quite a lot as whales will just hodl as the platform becomes more successful.
  • Usage of the platform: as above, if the token is fairly priced compared to the usage requirements and is liquid, people can use the platform.
  • Revenues / dividends collected by token owners: this aspect is most impacted by token and economy design rather than ICO design, but it’s of utmost importance if we’re to gauge the future price potential of the asset. It also impacts usage and distribution of the token (eg. who wants to hold it).
  • Participation from developers and others that can help the protocol: this can be impacted in the ICO by deciding how much of the token supply to distribute in exchange of work instead of in exchange for “cash”. The problem here is that reserving a random percentage of the token supply is a very complex guessing game as it’s pretty much impossible to predict how much the token will be worth in the future and in relation how much you can incentivize developers.

So, what’s the optimal structure?

Well the easy and obvious answer here is that there isn’t an optimal one, but a few easy changes that could help teams align incentives for everyone include:

Multiple fundraises!

This optimizes a lot of the things we were analyzing, as it gives the project proponent’s control over price / supply / risk for much longer.

Holding multiple fundraisers optimizes the amount raised and controls the token price over time.

Unfortunately, this is much harder to do when everything is immutable on a blockchain. I have a post in draft with a proposal on a structure, that I’ll try to publish soon.

Discretionary ownership!

Deciding who can own the token (at least in the early days, as it’s still a liquid instrument) might seem an “elitist” move but could actually be the easiest way to prevent whales and speculators messing up an economy and ecosystem.

Built-in, disclosed token economics!

If a token has a clear correlation to the success of the platform, more so than just a “well there will be more of a need for it”, then people will have greater incentives to own it and the proponents can tweak which kind of owners they’d prefer (users, speculators, etc.)


To incentivize participation and liquidity, I do think that most tokens would benefit from some sort of demurrage built-in.

Some easy models that could address some of the above:

Probably a topic for other posts (one for each!)

  • Pre-sales for value-add owners.
  • Multiple token types.
  • Early helicopter drops to users.

This is such a nascent issue and theme that I think we need everyone’s contribution. If you have some comments please respond or email me, or better publish your own thoughts!

A number of very interesting posts have come out since I’ve started writing this post (been in draft for a while..):

Vitalik Buterin’s take:

Albert Wenger’s take:

To keep track of all the new projects being launched in the space, I’m launching a newsletter called Token Economy very soon.

If you want to be kept up to date, you can subscribe on