DAO’s and increased social inequality

David Solomonoff, who monitors the intersection between the real and the virtual, cites the article by David Morris (in Aeon magazine) who writes about the Decentralized Autonomous Corporations that operate with minimal human intervention after being put in motion:

“In the allegedly imminent world of the Internet of Things … these autonomous cloud robots will be able to run free. They will execute contracts, manage supply chains, even open new markets. And though they will do all these things according to a logic designed by human creators, they need not be under direct human supervision. Buterin calls such constructs Decentralised Autonomous Organisations. More commonly, they are known as Distributed Autonomous Corporations, or DACs.

It’s an unassuming name, isn’t it? And yet, perhaps alarm bells are already ringing.

Who will own the DACs, who will profit from them – and whether ownership or profits are even the right terms – are still open questions. Larimer, from his tone to his pitch, seems relentlessly fixated on the idea that the funders of DACs will reap profits. The investment-like structure of DACs, funded by cryptocurrency, means that those who establish them, back them early and host them will benefit when their associated cryptocurrencies rise in value. Such enviable roles are reserved largely for the technically savvy, resource-rich, and well-educated: in other words, the already privileged.

On the other hand, the open nature of DACs might allow those who were excluded from traditional entrepreneurial channels to gather capital support for their ideas. Imagine startups in developing countries, frictionlessly funded by international backers in roles somewhere between investors and philanthropists. Whatever ominous developments the new technology portends for the managerial classes, it is still possible to imagine DACs contributing to the larger cause of global justice. After all, if they don’t care about borders, who is to say they won’t work to flatten the huge inequalities between nations?”

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