One of the great joys of our modern age, with its rapid advances in financial technology, is examining the latest innovation to try to figure out what centuries-old idea has been dressed up in cryptographical mystification. Sometimes this is pretty easy. Ethereum, the fascinating blockchain/smart-contract platform, has a pyramid scheme helpfully named " Ethereum Pyramid Contract ." The innovation is calling the pyramid scheme a pyramid scheme. (Also, blockchain!)
But Ethereum also has the DAO. Can you figure that one out? Here’s how the Wall Street Journal describes its innovation: Can a company run itself without executives or managers or a board of directors? One of the more radical experiments in technology aims to find out. Here’s how the DAO’s "Principles" page defines it: The DAO is a Decentralized Autonomous Organization (“DAO”) – more specifically, it is a new breed of human organization never before attempted. The DAO is borne from immutable, unstoppable, and irrefutable computer code, operated entirely by its members, and fueled using ETH which Creates DAO tokens. ("ETH" is Ether, the bitcoin-like virtual currency of Ethereum.) Here’s Fortune : The DAO is being touted as a model for a new kind of organization, created and run using blockchain software rather than conventional corporate structures.
Nearly everything having to do with Bitcoin and blockchain sounds like some mix of sci-fi, magic, and a pyramid scheme, so bear with us as we try and unpack all that. Nah, let’s skip ahead. An organization with no managers or board, in which every investor "gets a vote … proportional to their holdings," is called a "partnership." Solved it! The general partnership for a business purpose was called "societas negotiationis alicuius" in Roman law . So it predates, by a millennium or two, the blockchain. It’s closer to the age of belief in […]
