ConstitutionDAO is a true underdog story that gave the world an idea of what DAOs, a new form of blockchain-based community, can accomplish in the future.
For those not familiar with the saga, here’s what happened.
What is ConstitutionDAO?
ConstitutionDAO was launched on Nov. 11 by a group of crypto enthusiasts as an attempt to raise funds via DAO to buy the first printed version of the US Constitution, on auction by Sotheby’s.
This version is the last privately owned copy — of only 13 copies in total — of the Constitution, and ConstitutionDAO hoped to serve as to transfer it to community ownership rather than to a lone wealthy individual.
By Nov. 19, ConstitutionDAO raised nearly 11,000 ETH on JuiceBox, a community funding for people and projects, or just over $45 million — more than twice the estimated sale price of $20 million.
Unfortunately, ConstitutionDAO lost out the auction Citadel CEO, Ken Griffin.
Five days after the auction ended, ConstitutionDAO was in a state of turmoil. After several lively discussions, the organization’s core contributors announced on the 24th that they were shutting down ConstitutionDAO and would refund contributions automatically.
$PEOPLE, which ConstitutionDAO gave to contributors at a rate of 1 ETH to 1 million $PEOPLE, would be of no actual use as a governance token for the DAO. However, data from Footprint Analytics showed that its token price has experienced the ups and downs driven by community users.
The projects garnered 20,000 contributors in total.
What is a DAO?
DAO is short for Decentralised Autonomous Organisation. A DAO generally has a common goal of consensus and clear core values. Its democratized voting mechanism determines the direction of the organization and how it operates.
Here’s how ConstitutionDAO’s DAO was defined:
- Organizational form: ConstitutionDAO brought together a group of ordinary people on the internet. They communicated via Discord, Twitter and other internet communities, and almost achieved an incredibly lofty goal through their efficiency.
- Organizing consensus: Bringing the Constitution back to the people. This group of cryptocurrency enthusiasts chose DAO as the best way to respect and protect the spirit of the Constitution, believing all should share in it.
- Organizing rights distribution: Returning rights to community members. If ConstitutionDAO was successful, the members of DAO could vote on whether to put this precious copy of the Constitution on public display, putting it “into the hands of the people.” If the bid failed, the community members could discuss where the money will go.
These are some of the key points that set DAOs apart from traditional forms of organization.
The most significant advantage of a DAO is its global, permissionless character. It solves the problem of trust between people through blockchain technology. Every line of protocol strictly complies with the original code and cannot be modified.
How ConstitutionDAO shook up the world of blockchain
With the rapid advancement of blockchain technology and the growing abundance of decentralized applications, DAOs will grow extremely fast. They will become more and more essential, taking on more and more responsibilities.
From the rise and fall of ConstitutionDAO, we are glad to see that DAO has come to the forefront, and more and more people are exposed to and understand DAO, which will be a landmark event!