Introducing the Decentralized Flexible Organization

DFO is an open-source proposal for a new standard in the DAO ecosystem. DFO is based on a new approach of managing Smart Contracts as Micro Services to build a new generation of DAOs in wich Token Holders will be able to propose the edit, the kill and the add for every function of a Decentralized Application and even rule the front-end using Base64 On-chain data. To push this technology as forward as possible and achieve and enable communities of coders to start projects from scratch in an anonymous way.

TL;DR

UPDATE: A lot of fancy R&D things were happened since this post, we’re developing a Documentation and a new post that can work as a WP.

We’re not making some kind of scammy ICO, so we’re more focused on BUIDLing DFOhub than write things 😜

You can participate in our R&D to buidl DFO here: https://discord.gg/nHZ2bUd

ABSTRACT

The DAO concept is the most powerful killer application on top of Programmable Blockchains. The best example of successful DAO is MakerDAO and there are huge advanced in projects like DAO Stack or Digix DAO. Each of these projects has a custom kind of DAO with limited and specific kinds of voting rules for Token Holders.

How DAOs are able to reduce centralization and the needs of a legal known entity to trust developing Decentralized Applications?

Based on the concept of LAO (Legal Autonomous Organizations) and the upcoming rise of the Open Law, an interesting trend, is to think about DAOs as a Programmable Company powered by Token Holders as Shareholders with pre-determined voting rights in the economic, law and services choices.

There is a huge R&D in this field, as I wrote in an article published July 2019 on Hackernoon proposing a worldwide regulation of Crypto, DAOs, and Taxation, based on the unstoppable rise of new DAO based startups ruled by Anonymous Founders and Token Holders:

In the last century, we have built a financial structure for innovation, based on different regulations and different countries. In a globalization era, this way of regulating our world is creating a huge cultural and regulatory gap in fund raising ad innovation, excluding some countries, due to obsolete rules.

DAO recognized as an International Company could be a new and cheaper choice both for entrepreneurs and regulators, to do businesses and startups, solving by design accountability and legal expenses.

The most exciting opportunity in a future of DAOs instead of Regular Companies is to solve one of the hugest problems today in entrepreneurship and Venture Capitalism:

In fact, in a globalized market of innovation, this sounds weird and its challenging equality from countries with smart finance and networks like the US and countries with a stagnant financial system and network.

DAOs and the values of Voting Tokens rather than Shares of a Company are in a Globalized Market of Crypto, with the same rules all over the world, defeating the impact of the financial status of a single country in Startups.

From Brock Pierce at E773

“Historically most of the innovations come from the West Coast of the US, and reason why is not because people here are smarter, but because they have access to capital.”

The ICO bubble of 2017, even if 99% of projects have already failed, it’s an important indicator of how investors and entrepreneurs around the world are crazy for innovations and how with a simplified and globalized system to reach and manage funds without dealing with governments barriers, they are able to invest and start projects without territorial barriers.

In 2017 the ICO bubble had two fundamental points of failure, the first one was cultural, because nobody knew at the time how to create values with Tokens and even what the Blockchain is, with the insane idea of Tokens as a utility to use a Decentralized Application, that makes no sense, simply because the code is open-source, so anybody is able to fork the code and publish the copy of a Dapp without the needs of a Token.

Now after two years, people are starting realizing what the Blockchain is, what is the meaning of Decentralization and its valuable killer application, defeating any needs to trust a custodian and especially that Tokens make sense to rule a DAO instead as used as a utility to use a Forkable Service.

The second Point of Failure that made the ICO Bubble a Financial Disaster was the lack of features to rule a projects without needing to open a Legal Entity and as investors prospective the lack of features to trust founders without known who they’re, but trusting the code of the DApp and the DAO layer on top of it. All of these features are available today even Decentralized Stable Coins like the DAI.

How DAO can improve the Smart Contract developing?

Building disruptive and complex Decentralized Applications is a huge challenge today, not only for the scalability Trilemma but because in Programmable Blockchains the developing is limited by:

  • Slowly Developing and Pre-Release Bug Fixing: Smart Contracts once deployed they need to be killed and forked, so Coders have to be sure about the code and they need to trust third parties to scrutinize the code before to test it in the main-net with real users. This situation is exactly the contrary of what makes Web 2.0 fast and resilient.
  • Monolithic Coding and Limited Space: The monolithic way of coding Smart Contracts to build Decentralized Applications, is a huge gap for adoption, first of all for limitation of space in deploying to Programmable Blockchains…This situation cannot be improved to maintain the security of the network. Secondly, for the GAS used by users in calling a function inside a complex application (more complex is the code, more GAS users have to spend to call a function).

The current situation in Decentralized Application development is underlining a single point of failure in the entire industry:

The DAO concept can reduce drastically the needs of a well known centralized organization to fork, code and manage a Decentralized Application, but today we’re just at the beginning of this technology and it lacks a lot of features.

The most interesting evolution in smart contracts developing was done by Maker DAO, using the idea of Smart Contract’s Proxy that makes more resilient the usage of MakerDAO for users. Basically, when a user opens a CDP to manage the collateralization of his ETH, his DAI and so on, the CDP is a Smart Contract that works like a Proxy for to call external Smart Contracts.

This idea of multiple Smart Contracts connected to a Smart Contract as a Proxy is a hidden disruptive innovation that can change Smart Contract development, MakerDAO is working well and it’s very important as a proof of concept, but in that case, is hugely underestimated.

The concept of Smart Contract as a Proxy is able to choose what Smart Contracts the Decentralized Application is able to call, using it as a base layer can make a Dapp flexible, reducing the needs to trust an entity to fork the entire application for some pre-defined reasons.

This kind of approach is very interesting to start coding Smart Contracts as Microservices and build Resilient Decentralized Applications, in which if a Smart Contract fails, it’ll be easy to kill it without block the entire Application or without needs to involve a centralized entity to fork that.

How DAO concept can help Decentralized Applications to reduce the Centralized Servers Needs as much as possible?

You always need some way to access the blockchain (or, more precisely, a node which connects to the blockchain). With current technology those are mostly centralized frontends (web3)…I doubt there is any clear distinction what exactly is a ‘dapp’. The definition will probably get stricker as time goes by, but currently I’d imagine it’s mostly used to mean apps which have decentralized core functionality.

Dapps today have some points of failure to be completely decentralized not only in terms of Smart Contracts developing, as mentioned before, but regarding the front end and the DNS, so at the end of the day, they still need a company to trust that hosts some parts of the application.

For example, during the ICO bubble of 2017, a lot of scammers hosted a fake website of famous ICOs, copying the front-end, but calling their own Smart Contracts and at the end of the day, investors had sent their own crypto to scammer rather than investing in the ICO.

Another possible attack to a Decentralized Application can be from governments or web providers wich are able to block the connection of users to a well known entity that host it.

This situation is tricky, because in the future can make Web 3.0 applications in the same scenario of Web 2.0 applications today, in wich governments are able to censor applications if the well known organization that host it don’t do what they wants, like for example, whats happened on Twitter, the China government was able to censor accounts of people wich talk about politics for some critical days.

In the Web 3.0 the most simple attack Governments can do to a well known Company that host a Decentralized Application using their power to deal with are:

  • The Front-End Attack: If a Company rule the front end of a Dapp, the scenario of censorship is not impossible, in fact editing the Front-End you can choose easily what people can see, and even if the information is public in the Blockchain, users are not able to see some information inside the application.
  • The DNS Attack: If a Well-Known Entity hosts a Decentralized Application, governments can easily block the DNS connections to it. Someone can argue that this attack is limited by the fact that people can call Smart Contracts directly from the Main Net of the Blockchain, but this is very difficult for non-tech users and in terms of non-financial related applications is definitely a censoring model.

In this talk Mark Zuckerberg argued on how Governments are using all of their power to censor and manipulate the Web 2.0 platforms and how China is exporting Its Censorship-based Culture on Social Media.

To solve this kinds of attack the Decentralized Application industry is evolving with the usage of IPFS “InterPlanetary File System” for Front-End files, basically a distributed space, that makes more difficult to be censored, but not to make a Front-End Attack and the main issue of IPFS is that files can’t be faked, but at the same time can be lost if no one stores it as a node.

Another interesting evolving project is the ENS (https://ens.domains/), the Ethereum Name Service, the idea to use Ethereum-based name services to host a secure and decentralized way to address resources both on and off the blockchain using simple, human-readable names. The aim of ENS in the Long-Run is to replace the DNS, with a Censorship-Resistant version on top of Ethereum.

Another interesting solution for possible censorship can be NFTs “Non-Fungible Tokens”, basically unique Tokens that are able to store pieces of information. In fact, the Front-End code of an application can easily be stored into NFT, but a single NFT has very limited space for information.

Some months ago we developed an Open Source Protocol called ROBE to build chained NFTs that are able to store pieces of information surpassing the limits of a single NFT. With ROBE if an application is able to call the first or any other NFTs in a chain, it can easily take the rooting one and read all of the information stored in every NFT in the chain. here is the code:

https://github.com/b-u-i-d-l/ROBE

The most interesting thing is that if the Front-End is stored in NFTs so a DAO can rule it…

THE DAWN OF THE DECENTRALIZED FLEXIBLE ORGANIZATION

The Decentralized Flexible Organization is a new concept, that reshapes how we’re building Decentralized Applications, solving some critical points of failure in the today’s Dapp ecosystem like the needs of a Legal Known Entity to Trust, the slowly Smart Contract Developing and the Centralized or Distributed Servers Needs.

The Decentralized Flexible Organisation is a basic layer independent from the functions of a Decentralized Applications, with the aim to rule all of the developing and upgrade of it since the beginning in an anonymous way.
In fact, using DFO, the first step to start building a Decentralized Application is to Deploy the DAO side, with the Voting Token information and the Voting Rules.

Once deployed the DFO Smart Contract works as a Proxy to route functions in Read/Write rules or read-only rules to the connected Smart Contracts or Non-Fungible Tokens, so at the end of the day, Token Holders can vote the edit, kill or add functionality and design features of the Decentralized Application. Basically, the community can BUIDL, and 100% rule it without needs to trust an entity or to trust each other.

How Does it work?

In a DFO environment, Anyone or Token Holders (as pre-decided when the DFO is deployed) are able to deploy a Smart Contract or a series of chained NFTs and request to the Token Holders to connect it with the proxy as a new functionality, or to edit an existent functionality, by creating a “Survey Smart Contract” by adding a simple request to the DFO Proxy Smart Contract.

Once the voting period is finished anyone can trigger the finished event and automatically the Proxy Smart Contract will kill the old version of the functionality, if the survey was based on “Edit” or will add the new functionality, if the survey was based on “Add new”. (Voting rules and Block Time for the survey are pre-decided when the DFO is deployed and can be changed in the same way of changing any other functionality)

To reach this goal, the DFO is introducing a new way to deploy Flexible Decentralized Applications that will enable an interesting, smart way to code and deploy Smart Contracts, more like Microservices, and this is why we called it “Flexible” rather than “Autonomous.”

This Microservices kind of developing is fascinating because can introduce a new wave of Decentralized Application where if a single Smart Contract is broken, don’t block the entire application security and usability, but only the single function and it’ll be killed or edited fast without needs to a single entity to do emergency strategies like to fork the entire application.

Another important step forward is the idea to introduce NFTs for Front-End Code, so the DFO proxy is able to redirect users to the right NFTs to download the frontend code when a user’s browsers want to surf the Decentralized Application, and at the same time, Token Holders are able to easily vote for the front end connecting the Proxy to the chained NFTs they prefer.

This setup is a step forward for building Decentralized Application, that can be hosted by anyone in every kind of domain name, just adding one or two simple lines of code to redirect users to the Proxy of the DFO, making Dapps more censorship-resistant than ever before.

The code is here: https://github.com/b-u-i-d-l/DFO-protocol

And you can already start building a DFO and play with this new awesome way to deploy Flexible Decentralized Applications on Ethereum

THE DAWN OF THE ANONYMOUS STARTUPS WITHOUT FOUNDERS

The most exciting thing is that DFO can open the doors to a new wave of “Startups Without Founders,” in which a community of anonymous people now is able to start a project, deploying a DFO, and starting building it piece by piece without needs to trust third parties or a well-known team of developers.

In fact, with DFO anyone can start a project and deploying an external Smart Contract to airdrop Voting Tokens every time an anonymous Developer will win a Survey to improve or BUIDL the Application.

The implications are massive and the concept as is named is “flexible” so developers around the world will be free to design different kinds of DFOs, with different kinds of functions and economic incentives that were impossible before, without any needs of trusting entities or people and in an anonymous way.

DFOhub.eth

Programmable Equities and On-Chain Companies

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