Griff Green: How to Break the Technical Bureaucracy of DAOs

Author: Griff Green, Co-founder of Giveth, Commons Stack, and DAppNode
Compiled by: Vera, The SeeDao

What is Technocracy

KEY TAKEAWAYS

Griff Green, who joined the DAO space in 2015 and has witnessed its gradual growth, candidly reveals a long-standing dilemma within DAOs: technocracy.

Almost every DAO exhibits signs of technocracy. In most DAOs, the highest decision-making power is held by a small group of people who have the authority to veto anything. Any idea or proposal can only move forward if it receives the approval of this group. This greatly limits the development of DAOs and goes against their original intent. In this scenario, while it may be possible to successfully transition from off-chain to on-chain and achieve technical decentralization, it is challenging to realize true decentralization on social and cultural levels.

Subsequently, Griff Green uses Gitcoin as an example in his speech to elaborate on the current dilemmas faced by DAOs in this regard and the efforts made to address them.

Kevin Owocki founded Gitcoin in 2017, and after more than three years, they began to venture into the DAO space, completing a model transformation from a company to a DAO.

Owocki mentioned in a speech that he believes DAOs do not need a "father" (i.e., a CEO); a truly decentralized DAO must abandon centralism. His greatest contribution to Gitcoin's development has been consciously diminishing his role in the operation and decision-making of the DAO, stepping back to create a stage for the next generation of DAO leaders. At the same time, he provides them with a sense of security within the DAO, allowing them to boldly experiment, learn, and make mistakes without becoming overly arrogant.

Before completing this transformation, Gitcoin spent over a year educating the community, helping members understand Gitcoin's mission, values, and products. It is this talent pool built on prior preparation and knowledge that has enabled GitcoinDAO to develop a thriving, orderly, bottom-up product development capability. This has led to the formation of a decentralized culture and a unique, positive vibe, significantly reducing the presence of technocracy, collapsing the centralized towers that once dominated the community, and returning the community to every member.

The Roots of Technocracy "JUST DAO IT"

KEY TAKEAWAYS

What is JUST DAO IT

The proliferation of technocracy within DAOs is primarily due to the "JUST DAO IT" creation model. This is currently the most commonly used model for creating DAOs, which can be divided into the following five steps:

• STEP 1: Spark Ignition

Someone has a bright idea and says, "Hey, why don't we start a DAO!" Then others agree, saying, "That's a great idea, let's do it together!"

• STEP 2: Recruit Partners

Start recruiting and filling team gaps, initially forming a small team of 3-7 people.

• STEP 3: Design the Roadmap

The small team discusses matters internally, such as how to define the DAO's mission, vision, and values, and how to attract more people to join the organization, etc.

• STEP 4: Build the Community

Tokens are distributed through ICOs or airdrops to form a broad community. However, before issuing tokens, the small team has already conspired in a small room to finalize the overall development strategy of the DAO.

• STEP 5: JUST DAO IT

Members propose initiatives and vote with their tokens, and a DAO is born!

Disadvantages of JUST DAO IT

These founding members become the leaders within the DAO, determining its direction. If the core team disagrees, even if community members come up with good ideas, they will ultimately be stifled. Everything is decided by the founders of the DAO. (This is unfortunate, but it is the reality.)

Moreover, the JUST DAO IT model is more likely to create a highly profit-driven organization rather than a mission-driven one, such as Ape DAO. Everyone's goal is to make quick money; reportedly, 86% of people in Ape DAO voted to sell 164 Apes, which is detrimental to the community's sustainable development. Of course, if your focus is on making money, you can certainly adopt the "JUST DAO IT" model, as it may even help establish an internal decentralized mechanism, since "making a fortune" is almost an unassailable focal point. However, if you want to build a mission-driven DAO that genuinely contributes value to society and solves real problems, you must find another path.

Griff Green uses the metaphor of "chess" in his speech. The JUST DAO IT model is akin to early founders starting a chess game and making a few moves according to their own ideas, then handing the game over to the community, forgetting their inherent advantage as the initial players. In this case, community members' ideas will inevitably be influenced by their opinions, and they will also inevitably want to maintain control over the overall situation.

[Theoretical Aspect] How to Eliminate Technocracy

KEY TAKEAWAYS

Griff Green states that their team was greatly inspired by Nobel laureate Elinor Ostrom's research on the sustainable management of common-pool resources, which serves as the theoretical foundation for their exploration of eliminating technocracy.

If you want to create a sustainable DAO, it is essential to thoroughly read Ostrom's eight principles for the governance of common-pool resources, which can be summarized as follows:

• Clearly defined boundaries;
• Rules for appropriation, provision, and local conditions are consistent;
• Collective choice;
• Monitoring and sanctioning;
• Graduated sanctions;
• Conflict resolution mechanisms;
• Minimal recognition of organizational rights;
• Nested organizations.

Additionally, Ostrom proposed that the people closest to the problem should be the ones to solve it. This principle is equally applicable to DAOs and provides a way to eliminate technocracy. Since those closest to the problem often receive direct feedback, they are generally better equipped to handle issues than a small group at the top.

However, this raises other questions, such as what if those closest to the problem lack the ability to solve it? How can efficiency be improved while forming internal consensus? Don't worry, Griff Green provides an answer through a practical case study.

[Practical Aspect] How to Eliminate Technocracy

KEY TAKEAWAYS

The Commons Stack has taken the lead in thinking and innovating around the issue of technocracy in DAOs.

In 2019, Griff Green and two companions, Jeff Emmett and Michael Zargham, developed a new DAO creation model based on Elinor Ostrom's theoretical research—the collaborative economy framework—and used it to incubate the Token Engineering Commons (TEC), which took a year to develop.

This model consists of six steps:

• STEP 1: Spark Ignition

In the collaborative economy model, this step remains essential. Someone must first "centralize" their idea for a DAO to have a chance of being realized.

• STEP 2: Build the Community

They built a dual-token system for TEC, consisting of reputation tokens and liquidity tokens.

The reputation system is called "impact hours," which rewards contributions made by labor and professionals within the community. This system uses self-nomination, where DAO members publicly nominate those who have made significant contributions in a decentralized manner. The nominees receive points, which can be exchanged for reputation tokens. Reputation tokens are non-transferable and cannot be traded.

The liquidity token system quantifies the potential of capital to become an investor. Capital is a double-edged sword; while it increases cash flow, it can also lead to capital exploitation. Therefore, to ensure alignment of values between investors and the organization, TEC only accepts investments from individuals associated with The Trust Seed. The list of personnel from The Trust Seed undergoes strict manual review to filter out profit-driven speculators, leaving only those who genuinely want to create value and build a mission/value-driven group. The corresponding token for this system is Seed Stack; the more Seed Stack tokens you hold, the more money you can invest.

• STEP 3: Mission, Vision, Values (MVV)

The community collectively decides the DAO's mission, vision, and values. Before that, the community provides space for members to learn and discuss to reach internal consensus. Afterward, the community organizes two rounds of brainstorming regarding the MVV, evaluating based on quality to finalize the MVV.

Interestingly, TEC pays great attention to the deeper meaning and intent behind these ideas. To avoid language barriers that might cause non-native English speakers' good ideas to be overlooked, a professional editor is invited to correct language issues between the first and second rounds. This way, everyone can start from the same starting line, achieving truly humanized decentralization.

• STEP 4: Determine the Economic Model & Visualization

TEC and The Commons Stack have a cooperative relationship, allowing them to directly use the economic models from The Commons Stack, such as augmented bonding curves and conviction voting mechanisms. However, for most other DAOs, it is still necessary to vote to select a suitable economic model.

After determining the economic model, TEC spent a significant amount of time building a dashboard to help non-technical members quickly integrate and improve the accessibility and readability of the economic model.

• STEP 5: Design the Economic System

Party Time~

The collaborative economy mechanism needs to create fun, making everything interesting and attracting everyone to participate, rather than assigning tasks like a teacher in a classroom.

TEC provides venues for parties (regularly hosting Param Parties) to encourage collective brainstorming. However, parties filled with "mutual flattery" do not genuinely solve problems, so TEC provides internal guidance and education to help members enhance their understanding, enabling them to engage in critical thinking and debate at the parties.

Internal debates are not about creating opposing viewpoints; rather, since everyone has reached consensus on the MVV, all viewpoints focus on the same goal: to develop an economic system that aligns with the MVV, thus eliminating the existence of absolute debate winners.

However, once all the parties conclude, a final economic system proposal must be established. TEC employs a dual-round voting mechanism to reduce time costs. For example, when the community needs to vote on 80 economic system proposals, the first round uses quadratic voting based on reputation tokens; the second round uses ranked-choice voting, with only 3-5 options available, allowing everyone to vote after understanding the content of each proposal. The first round serves as a preliminary selection, while the second round is the actual vote.

• STEP 6: Form Community Culture

After the above five steps, the DAO has established a dual-token system, determined the organization's MVV, built an economic model and visualization tools, and developed an economic system. The entire process is quite clear. Most importantly, community members have learned about and participated in the entire system-building process in an engaging way over several months, forming a cultural resilience strong enough to combat technocracy.

At this point, if there are so-called "leaders" wanting to take control (even if some do so with good intentions), members have the confidence to say no, refute opposing viewpoints, and provide personal insights based on their knowledge accumulation.

When every member of the community is personally involved and educated, technocracy will crumble. "We need educated democracy; that is true democracy," and the collaborative economy model will help us achieve this.