Subjective agreements for DAOs

Transcript

people oh you can put your computer with okay you you know what Farrakhan one right now

first of all sorry I couldn't be in Paris with all of you which I would have I would have really really liked but decided to take some extra precautions with the current virus app outbreak and today the the topic that I wanted to talk about is one of the things that we've we've been spending most of our time at our bond ID which are how can we get subjective agreements into into decentralized organizations so entire going with in working on doubt since late 2008 2016 and we've been seeing a lot of patterns in terms of the operations of these organizations and this is something that we've been

spending a lot of a lot of time on and it can dramatically improve the way that we interact with the house so in terms of the the current outlook with without how is it to operate the house in 2020 right now the the thing that it's kind of replicated in in every in every organization right now is that there's a small fraction of highly motivated members sometimes it's even just one of them the really cards for the organization has a vision for it and kind of its convincing others to join in crafting some of the some of our most of the proposals and then weeping boats

right there's this process of knowing what the organization was doing but then there's someone that actually takes on the on the work or making that happen in the in the organization and this is not necessarily bad it's kind of the pattern that that we're seeing with the with the current state of the of the technology and the another thing that is kind of very very apparent said that proposal said to pass an organization's I usually have very very low butter toner to turnout and this again is not something that's not necessarily bad but it's kind of a sign that the governance and like the the decision making of the

organization was already happening somewhere else and then at the moment that people in truck would be down of telling the Machine what he what he needs what he needs to do and there's a lot of this operation so people are not taking proposals every every moment because they they're mainly small type proposals that they already have got or consensus on but D on the other side of this is that this voter disorder apathy can lead to a legitimate proposal spin on notice given that every single thing needs to be needs to be voted on by all the

members of the but some of the members of the organization there's so if there's some high volume of proposals something that is actually very very important that can set the course for howdy how the organization operates that can be a notice and these are these are the proposals that actually deserve the detection of the of the entire organization on the other side we have traditional entities with legal entities there right now are man it's way more optimistically and by optimistically I mean that not every operation in our in a traditional legal entity needs to be approved by a by all the shareholders of this organization or they even they

don't even get a say on this and this can be done because there are like two main things that are that are present here first of all is that there's social capital at stake doing something doing something malicious can be a very bad hit for the federal reputation of someone that is a manager for the Ferger organization so that kind of prevents people from from doing so like Jordan do the likelihood of you doing something very malicious if you're seeing the these people or that you know them I have a relationship it's it's it's it's less likely and there's also trusting these situations that can offer recourse in case that something actually goes

goes bad if you do something malicious as an executive for manager for an organization do you know that there can be repercussions even if you even if you can do that but on the other hand by the characteristics at the house and when I'm talking about - I'm talking about like completely sovereign doubts that do not have any sort of legal wrapping or or kyc there man it's very very prettily today this is you to kind of tea some of the United party's that dowse have such as the information list and pseudonymity friendly right the

members of an organization you couldn't know if they're like a person or a refrigerator after all for all you know you just they're just addresses and on the two things with the organization and this kind of has the consequence that there's really there's no necessarily any social capital that's at stake if they're like completely permissionless and pseudonymous and actually because of this there's also little to no legal recourse or recourse of any in of any sense in case that malicious action happens in the organization once once an action happens there's usually no way to get that to get that reverted so that

being able to not been able to have these properties that makes those like very inefficient to run because every single thing that the organization needs do requires the explicit approval and the pessimistic approval by members of the organization just a simple example and just in a in a traditional in the traditional entity we have is like a person in the indian during in this company that has access to perform actions performed transactions and have from the each company's bank account if every time that bob imagine that he's

the head of head of HR and runs payroll he had to ask for permission it would be very very inefficient but even if he has permission to like move potentially move like a huge amount sum of money to do its own bank account he knows that the legal social consequences of that are are very bad and there's also the chance that someone will will see that malicious malicious transfer well as ground and there's even possibility that the transfer will be able to be reverted even before that happens so this is some of the deterrents that that prevent the bad

behavior even though there's a the afforestation technically the authorization to perform anything in the in the like out of out of the accompanied bank account and this this comes with massive massive efficiency in which like there's no need for every member every shareholder or even like have very strict very strict authorization processes because someone we know that there's there's recourse for that and this is something that we really kind of do with doubts because for for a dhow for a organization that just leaves in a smart contract that

it's like a computer program after after all it kind of sense the difference in like the the type of transactions a transfer for a performance bonus can be also theft of someone that they just want to get a bonus that was totally not approved or something very very specific with doubts that transfer to move the entire tracery of the organization to some other address it can be because of a migration to an improve better version of the software that doesn't have a bag or it can be a 51% attack for all we know these are things that have a

subjective like some subjectivity that is either really hard to encoding into a computer program let alone to it without backs or ways to exploit it or just impossible because it's it's impossible to encode these walls and this is desire for more like clear cases of even theft but there's also aspects of that's the thing that we're doing even aligned with with or values or the mission or the or the organization and and also making sure that we can encode protections for minority stakeholders which is something that a computer program cannot

understand so with agreements what we wanted to do is encoding rules in taos that they're not objective they they're not something that you can even put into a computer program but at the same time we can do something to protect minorities stakeholders you know in a tile from a mmm tyranny of the majority that sells all the could sell all the assets and also that can allowed this more optimistic management style of the organization I came to traditional traditional entities but also keeping most of the advantages if not all of the advantages of sovereignty tell

organizations that are not controlled by or cannot be interfered with by a government or any third parties so do something that we wrote about with your regional r1 that were white white paper and that we've been within within polish and butty something that became very apparent very fast is that for four thousand detail organizations to become widely used and very useful there's some services that the state provides that we kind of need to replicate because this completely sovereign entities that don't have any legal entity counterparty they

they just kind of use because they're they're not recognized by the system so this is why we started working on our Burnett work which we called say it is a detailed jurisdiction for detail organizations trying to bridge the gap of soup with some of these services I didn't like very simply it's a job and a family of protocols that create a parallel system of law that dowse can opt into this is very important this is not something that it's gonna be imposed to any doubt it's a completely obtain jurisdiction that the Dow's can opt into in order to get some of these some of these advantages and also its

jurisdiction that is a completely true limited liability this is also because of the properties of the system a blockchain cannot or a computer program cannot put you in jail by by itself so everything that that that we do must be with clear collateralized actions that are put beforehand and that is everyone knows that that is the maximum amount of of liability that they can have one performing actions indeed the biggest thing is like enabling trust transfer interactions between individuals and organizations and also between the interactions from organization to

organization being able to tap into this subjective subjective aspects that there were that happen every every day well-run organization a nurturing business is very very important for the for the efficient running of these organizations and these are services that infrastructural services that are provided to all the users of everyone one of the keys key stones of this of the Aragon Network and it's it's our home court so our Concord is a dispute resolution protocol that it was built to be able to solve subjective disputes in an

organization either between the members especially between the members of the organization and their relationship with each other and the organization itself it can be used by any theorem account or or dau including the area network itself which is by itself a Tau which is a very different from the from the legal system it this is a like a a protocol that just doesn't doesn't understand legal personality other than what it's explicitly said in in agreement so anyone anyone can use it and be able to solve subjective disputes and most importantly it's it's also

governed by a in holders that get to parametrize a protocol to make sure it can operate correctly so these are some screenshots from the ER Concord dashboard which was launched on February 10th and it's running for for over a month now the the the way that the protocol protocol works is it's very very simple really so whenever someone creates a dispute there's a period for anyone to provide evidence and kind of their arguments for why did still should be resolved one way or another and then there's a we draft jurors had drafted randomly

proportionally to their stake and they get whenever they get drafted they they're required to review the case communal bill the road and at that point there's a tally of all the boats that did yours submitted there's a provisional ruling that can be appealed if someone doesn't doesn't feel like that was a fair outcome in order to appeal the appeal to move forward there needs to be someone that supports another side in you know if there's no one that wants to confirm the appeal and so for the previous decision it is we go to a final Berlin and this can be appealed a small number of times until team until there's a final round in

which all yours are are invited to vote enough final outcome is decided upon for yours the jurors have been already is taken into our Concord by converting a int into a NJ IJ which the staking native second token of the of the court and it gives yours like a proportional chance to be drafted for disputes and also a proportional pro rata share of T of the of this scription fees that that are collected by the court by the organizations that they rely on it so far there we had were very very happy and very surprised that over 250 years joined Jeanette lunch and

after after lunch there's been some summer activations and the activations but the total number of yours in the Arabic Network has been around 250 with over a million in empty state so with this infrastructure Argan agreements they're a set of non computable rules that an organization sets to define whether an organization interaction is listed or illicit indeed the core idea that we want to get with this is turning crypto native organizations or dowse from very pessimistic organizations into optimistic ones the the way that works is that certain actions in the Dow even

like transferring assets directly can be limited other more than just to it buy buy buy a boat but be able to do it by equipment signers directly has rules in some examples later sending the equipment requires looking some certain amount of collateral that the equipment defines and then if the signer misbehaves lies Medina a malicious action their collateral can be can be slashed and the way that we decide if the action that they're performing goes in goes with the agreement is decided by by our Concord by by creating a dispute the premier's said that an agreement has one go too

much into details there's the agreement text so agreements even though there's a smart contract component the magnetism they're actually human readable explanation of how it works it's allows to encode a lot of subtlety and processes that would be very very difficult to encode into into a smart contract then there's some parameters with regards to what are the the collateral requirements what is the delay because all the actions need to be delayed in order for them to be stopped in time and then kind of the statute of limitations before after how many time how much time after just performed an action and you

can you be sized for it this is a simple example of an agreement that that we that we made for for a particular for a particular use case which I won't get into right now but kind of the the the flow for for signing an agreement once the organization sits sits if women and invites certain parties is they will review the equipment and see what rights they will get by virtue of signing the agreement and if they agree with that and they want to get that power and you see this organization in that way they will lock their the the collateral which will enable them to perform actions with

with a certaintly this is an example of a UI mock that we have for they were working with for four agreements but this still is still an early early prototype and in in terms of the action whenever there's an action submitted and signer of the equipment performs performs the action on rather than executing the action directly the action gets queued and it's put in that in a in a in a delayed a queue for for execution that anyone can see and decide whether they think that the action goes accordingly with with the equipment that they sent and if they don't think that

that's the case they can create a challenge for the greater challenge for the action that comes with a settlement offer in which like someone can say okay if you decide to like not perform this action you can you can get like this part of your collateral or not get slice at all if there's no settlement then the action will be will be taken to trial court and the execution will be decided upon it's another mock-up in kind of like very very going into some some of the use cases that that we think are very very interesting for agreements the first one is proposal agreements and this is our solution for 51% attacks so

even an organization can set what the what the rules for for making proposals what things can even be voted on and this can be a way to prevent the tyranny of the majority it was like some types of proposals like one in which a minority is clearly is basically it's clearly removed from from their rights and increment that can be stopped and not you not even voted on by the white organization so that minorities can can can be sure that even if if maturity boat could could screw them and take over their rights they know that there's a there's a recourse for proposals not

to be even voted on if they're not according to how the organization operates in terms of efficiency there there's also this this thing that we call the executive REM instead for some recurring tasks in the organization are very low stakes actions an organization can set executive type agreements that allow certain members in the organization to directly execute actions in the organization without having to go through a boat if the if they go over the line and they perform something that they weren't allowed to perform their action can be challenged before it even gets executed but for the very long

telephone operations in a doubt it might be recurring this can be performed without even even getting to a boat and to end and something that we're actively looking on right now and that I think it's very interesting it's what we call governance agreements right now managing dowse it's already happening of chain and like the governance process at enough chain for the most part and kind of the actual boating into Dow is kind of like pressing buttons in the machine after decision was was already made in some instances so what a governor women could allow sex a okay we're differ in some of these decision-making

processes directly to an off chain mechanism be that appalled or or whatever mechanism that might be and then an observer member of the organization can directly execute the action in the organization based on the fact that there was already consensus off chain for that and if that wasn't the case and it can be challenged and evidence can be provided for whether there was consensus or not for the for the action so these are some of the examples and use cases that were we're seeing with with agreements but we're super excited to see what what people build build with them and actually how

we can take doubts from these like very pessimistic slow inefficient missions into getting some of the nice property instead traditional organizations have without losing all the nice properties that the TAS have thank you