Peer Production on the Crypto Commons

Version 0.8

Toward a Commons Based Economy

Moloch DAO

Moloch DAO is a smart contract DAO launched in early 2019 for funding development of the Ethereum ecosystem. Members of the DAO have non-transferable shares which they can use to vote on proposals. The DAO is funded by “tribute”, when new members join they add resources to the fund. It is in a sense a DAO for collectively administering donations.

Proposals relate to minting new shares and assigning them to (new or existing) members in exchange for tribute (or promised work). Members vote to control who is allowed to join and how shares are issued. All members can cash in their shares for a proportion of the fund, but they then lose voting power. When a proposal passes, any members of the defeated minority who opposed it can withdraw their funds (“ragequit”) before the proposal is paid out, leaving those who approved it to pay a larger proportion. This mechanism is intended to make the fund resistant to majority attack - if a majority approves a large payment for itself the minority can exit before they are diluted by this act. It may also serve to promote group cohesion, as members may avoid pushing or voting for a proposal if they believe it will cause other members to ragequit.

As of August 18th 2019, 85 Moloch DAO proposals have been completed, and a further 10 are being voted on. Most of the proposals so far have been about granting membership (and some shares) to specific Ethereum community members. The standard issue of new shares is 100, for which people have been contributing an equivalent quantity of 100 ETH (~$20,000). Vitalik Buterin and Joseph Lubin both acquired 1,000 shares (and donated 1,000 ETH) each. Many proposals refer to applicants as numbered members of an organization (e.g. ConsenSys has 9 members, Ethereum Foundation has 10). In this initial phase the DAO is being seeded with members who are effectively hand-picked by the leaders in the ecosystem.

More recently, Moloch seems to be moving past the onboarding phase and there are a greater proportion of proposals to fund specific people/projects. The fund currently holds 7249 ETH (~$1.5 million) and has paid out ~$55k so far, most funded proposals are for <$10k.

Moloch Clones

MetaCartel DAO was instigated by pet3rpan, the first person to be refused membership in Moloch DAO. pet3rpan was not discouraged, and decided to clone Moloch and start their own DAO, with 17 members and 750 ETH (~$200k), and a focus on DApp development support. In Sep 2019 MetaCartel DAO completed its second round of proposal funding, so far it has funded 6 proposals with a total of around $20k.

In addition to launching MetaCartel DAO, pet3rpan has produced a walkthrough that others can follow to spin up their own Moloch clone. Others are following, with new Moloch type DAOs popping up for such diverse purposes as organizing a Year of DAOs event and Whisky tasting party (OrichiDAO), and supporting the Presidential campaign of Andrew Yang (YangDAO).

These Moloch clones signal competition for DAO platforms like Aragon and DAOstack. A Moloch type DAO is much simpler, with many fewer lines of code, than a DAO on one of the platforms. Complexity makes software harder to secure, and so simpler DAOs may have an advantage when it comes to larger sums. There are also no fees involved in cloning and editing a set of smart contracts that are already publicly available.

Last updated on 11 Sep 2019
Published on 11 Sep 2019
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