The internet has of course decentralized communication. News and information no longer flow through few centralized sources: they come every which way. And this has inaugurated all kinds of changes in how we understand information, how we interact with each other, how we live day to day.
But the internet remains centralized. Companies build server farms that act as storage and way stations for the flow of this information. This creates security risks as all your data is sitting on servers that are waiting to be hacked. It also creates an ease of censorship: YouTube can pull videos as it wishes. Or the US government can seize the servers of Backpage and, just like that, that information and the worlds depending on it are gone. A decentralized internet poses certain technological complications, sure, but it also promises better security and freedom from the will of a centralized few.
Capital, too, remains centralized as it runs through banks and is all regulated by governments. And so it’s not surprising that capital remains in the hands of the few: people who literally create money tend to keep that money close. Decentralized capital in the form of crypto peer-to-peer networks cuts out these middlemen, letting capital flow more readily in different directions.
And then there are corporations which, alas, remain centralized. Executive teams and their boards control the workings of these enormous entities as the wealth they generate flows rather conspicuously in one direction: up to them — not to their users whose data is being used and sold without compensation, not to employees who do the actual work, but to the few at the top.
Sure, you can buy stock in a company but, oddly enough, that doesn’t give you any access to a company’s profits. Stocks are a distinct market that are only linked to corporate earnings through perception (and, sometimes, via dividends). Otherwise, all that wealth accumulates at a central point at the top of the pyramid where those handful of folks do with it what they will.
But blockchain and other such technologies not only offer decentralized storage and decentralized economic tools, they offer decentralized organizations: the DAO, or decentralized autonomous organizations. This, to me, is the most exciting thing happening today as it inaugurates a radical shift in wealth distribution in a way that supersedes the all-too-familiar debates that plague political discussions.
A DAO has no single governing body. It is a set of computational rules that run along a network.
Once these rules are set in motion, they can’t be touched again — unless, according to the particular rules of that network, some majority of participants choose to do so. This eliminates any capricious or furtive moves by a few executives and a board to hoard wealth for themselves. In a DAO, the network runs as it runs, transparently.
Just think about how corporations stand towards the world: they stand at the middle of this vast commercial engine and reduce the rest of us to “consumers.” Eeesh! Just writing the word “consumer” makes me cringe. For that is all we are to centralized corporations: consumers of their goods. Or we may be the even more reductive and dehumanizing “user.” But we’re certainly not participants, partners, or co-creators. We give — our data, our time, our content — which they take and profit from. Maybe they give us some money for our labor but it’s a measly percentage of the profits.
DAOs fundamentally shift the relationship between creator and consumer. (Ah! That word again!) In DAOs, we are participants in the network, sharing in the wealth the network generates — and participating in the governance of the network! We are no longer passive users, duped consumers, or even exploited labor: we are co-creators with control over our data as well as having a voice in how and the DAO develops. We become active participants in our digital and financial lives.
For instance, imagine a decentralized social network running as a DAO. We interact with it, with friends and family, and post content while advertisers mine our data and push ads our way. But as we are active participants in this network, constitutive of it, we control what data we share or don’t share. And, perhaps more importantly, we share in the value our data generates — which is automatically returned to us via smart contracts. And, depending on the terms of that DAO, we even get to vote on what features and functions should be rolled out next. (This of course invites some complexity in rolling out changes; after all, centralization does have some efficiencies in decision making — but that’s a matter for another discussion.) In any case, DAOs have the ability to return sovereignty and agency to what were once “users” and “consumers.”
What’s so alluring about this to me is that the DAO supersedes the tired debate between so-called capitalism and socialism (I write “so-called” as there are wildly varied definitions of these things), between free markets and governmental control. Yes, DAOs function as part of the free market trying to woo users but not just by selling them something to consume but rather by inviting them to participate and share the wealth, to be participants in its creation. In that sense, then, DAOs are indeed capitalist but in a post-corporate reality where the game is no longer rigged by governmental fiat bought by corporations.
This is a road to financial equity. Mind you, I didn’t say financial equality as I’m not sure what that means. I am talking about financial equity — fairness, access, open participation in value and wealth generation. Decentralization has the power to usher in a true and quiet revolution in which everyone in the world is invited to participate in the global economy, in which people are no longer consumers or users but are human beings sharing in the wealth that they themselves generate.
This is how we elevate so many out of poverty and disease, how we create fundamental changes in wealth distribution — not with marches and Tweets, not with petitions and inspired Facebook posts, but by building a powerful and viable alternative to the reigning centralized corporate model of value extraction and exploitation by the few, of the many. This, then, is how the world changes: by creating new modes of financial participation, free of both government and corporate control, where human life is considered inherently valuable.