Decentralized Autonomous Organizations Will Disrupt Authoritarian Systems

Human error, corruption, and bias are responsible for most of the problems that humans experience, which is why there is so much excitement about technology like self-driving cars or robot surgeons that could eliminate the fallible human element from some of our most dangerous tasks.

Human administrators could soon be replaced by algorithms that automate many of the functions that archaic structures like governments and corporations have previously served. The technology to make this possible is in its infancy, but as nation-states around the world continue to collapse in the coming years, Decentralized Autonomous Organizations (DAO) will continue to grow in scale, and eventually, they will be a more attractive alternative to centralized systems that offer nothing of value in comparison, aside from nostalgia and familiarity.

Blockchain technology and smart contracts allow for groups of people to interact, anonymously if they wish, without the need for a trusted intermediary or “middle-man.” In the few years that these tools have been available, we have already seen the development of a decentralized currency in the form of Bitcoin, which is on the verge of becoming a defacto world reserve currency, along with decentralized financial institutions like MakerDAO, AAVE, Yearn.Finance or the many other applications that make up the decentralized finance (DeFi) ecosystem.

This is especially important as we move into an age where corporate censorship is on the rise and institutions like the International Monetary Fund are calling for credit scores to be tied to an individuals web browsing history and consumer purchasing history. The implications of this are literally biblical in that people with “unapproved” social, political or even spiritual views might be subject to deplatforming and then denied access to the traditional finance system. How long before getting banned on Facebook or Twitter leads to your bank accounts being closed or even losing other rights like freedom of speech, movement or the right to defend yourself? We are also seeing similar rhetoric in the health industry. In the wake of Covid corporations and government are calling for “vaccine passports”. Will those who refuse vaccines also be denied access to financial services? DeFi applications provide loans and other financial services that would not be available in traditional financial markets, especially for people who might not have government identification or are otherwise excluded from the legacy banking system.

Finance is just the first industry that this technology is disrupting and decentralizing, but it won’t be the last.

It is only a matter of time before similar innovations start to disrupt institutions that were once thought to be the foundation of civilization. Once the masses become more familiar with “self-driving banks,” corporations and governments will be next.

The modern economy is dominated by tech monopolies that provide incredible services, but seem overwhelmingly hated by both their employees and their customers. These frustrations are often the result of decisions that are made at an administrative level, especially decisions about user data and working conditions like pay and hours. For example, with social media, users are frustrated that they have no control over their data, a valuable resource that is harvested and sold to the highest bidder. Decentralized alternatives, like Hive, Steemit, and others, pay users for the content that they create and publish on the site. These sites are owned by the community, with members playing a larger role if they are more heavily invested, well respected by the community, or developing on the platform.

This model can also be disruptive when applied to other dominant tech companies like Amazon or Spotify, where true mutually beneficial exchange is being impeded by the budgets and self-interested motives of an authoritative intermediary. In these use-cases, people who are selling a product or publishing music could connect directly with their customers through a series of smart contracts that automate the administrative process. Meanwhile, the financial savings are passed along to both the customer and the creator, but most importantly, the community of users will be able to shape the rules, culture, and philosophy of the organization through decentralized governance.

The same principle applies to the nation-state itself, which is an ancient system of organization, especially when compared to a DAO. Humans are social creatures who instinctively join together on social projects to improve their lives, but that doesn’t mean that this arrangement needs to be toxic, as it has for many generations. There is a lot of healing that needs to happen in our species, but surely one of the first steps in this process is to decentralize the institutions that are overrun with authorities who can’t be trusted.