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DAO Punks Cohort_4 - Week 5

Consensus Creates Reality



A protocol according to wikipedia is “a system of rules that allows two or more entities of a communications system to transmit information via any variation of a physical quantity. The protocol defines the rules, syntax, semantics, and synchronization of communication and possible error recovery methods. Protocols may be implemented by hardware, software, or a combination of both.” 


Last week was all personal and fed into my individual being and soul.  I need that time to reflect and think about my unique place in this world. This week is also getting deep for me, but in a different way. So let’s continue here and see if this makes any sense outside of my head. 


Every time I have brainstormed on what to write for my DAO Punk Cohort_4 blog entry this week, I keep coming back to the word protocol. It almost seems like there is a paradox happening with DAOs and specifically with DAO Punks. A protocol is a system of rules, but at the same time a DAO Punk does not find themselves able to work well within the system of rules that govern a corporation. I suppose the key word here is “decentralized”.

In a short I made for this week’s Crypto Sapiens Onchain Alpha episode with Carl Cervone of OpenSource.Observer, Carl speaks about the counter-intuitive nature of protocols. They need a leader with a CEO mindset with a big vision to build the protocol. Powerful and effective leaders, however, oftentimes have the ego and the drive for recognition that goes along with it. In last week’s news, Bloomberg also announced that Merkle, “A developer of software for decentralized social-media networks founded by two former Coinbase Global Inc. executives is close to completing a funding round valuing it at about $1 billion”. This news and the episode on Crypto Sapiens has really driven me to reflect on the definition of a decentralized protocol and the mechanisms behind it. 


In my last blog entry I expounded on the virtues of remembrance and preserving stories. Yet here in the very same blog just a week later, I am speaking about builders of protocols who desire nothing more than to be forgotten so that a system may thrive on. It seems like a delicate and nuanced paradox. At what point does a need for a story to be told cross over to becoming ego-driven and the root of an ineffective protocol? I suppose it is when there becomes a reliance on one particular person to execute a process for it to function as a whole. For a true protocol, one should not be able to remember who the protocol leaders are. The story is no longer them. They have vanished from history and are no longer critical to sustain the protocol. 

My first thought when I heard Carl speaking was the destruction of the ego. The destruction of the ego is pervasive in many religions and philosophies. Our ego seems to be the only thing holding us back from freeing our souls. In order for our souls to live forever we have to live in gratitude and in a state of trust outside of ourselves. When we trust in one person, or only ourselves, we will always be disappointed at some point. 


Blockchains are built to be trustless.  On pg 63 of Chris Dixon’s book Read Write Own, he says in a blockchain there is no need for a“…higher authority — no intermediary, no central corporation — to oversee transactions. Through their consensus process, blockchains can securely verify the senders of transactions all by themselves, and no one computer has the power to alter the rules.” A system (protocol) keeps everyone honest. We tend to trust what we perceive as honest. A protocol is built on and creates consensus. Consensus comes from communication between two or more entities. That intangible relationship is where trust and honesty are born. It is a spark of creation. It is reality. Consensus is a mechanism with which to form reality. Consensus is by definition a noun in the dictionary, but to consent is a verb. This word is very blurry to me as it seems to be an action, a state of being, and an idea. A system with true consensus and transparency is called trustless. With consensus those who are consenting have transparency and as Dixon also says “transparency begets trust”.

So there’s the paradox, a trustless protocol built by consensus creates trust. Consensus by definition needs more than one person and a relationship requires a sharing of energy. A healthy sharing of energy is the first step to dissolving your ego. (Even in an unhealthy relationship one person can take/steal another person’s ego causing an imbalance). Every time a relationship is formed more of the individual ego dissipates. When a person joins a community of relationships, those multiple relationships dissolve into mechanisms of living that benefit the community as a whole. Each of those relationships are the individual units of a protocol. As people are born and die, the relationships as actions that sustain a community, ideally are passed to the new individual  to keep the action in place and preserve the health of the community. As time passes and external circumstances changes, those relationships that form consensus need modification to adapt to new factors. This is where in each generation the ego plays its part. The ego is not good or bad, it is the disrupter. The receptor of change that tells the individual to change something.

I am thinking about what it means to work in a DAO. On top of that, what does it mean to be a punk? Being is a DAO is being in a decentralized community with an autonomous structure that is not dependent on a hierarchy, a leader, or any single executive decision. A punk on the other hand is hyper individualistic and rebellious. But that does not mean a punk shuns community. As I said in my previous week 2 blog post “...does it mean that you have a certain type of stubborn faith that what you need to survive will be given to you by those around you? Not because you don’t want to work and are looking for handouts, but because you believe so strongly in standing up for what’s right and rejecting our mainstream comforts that you will proudly be derisively called a punk by the normie. As a result you have faith that those in your community that see the value in your stance, will see to it that you have what you need.


So my reflection for this week is that trust and trustlessness are like yin and yang ever cycling off of each other like a constant feedback loop. DAOs are based on decentralized individual networks of relationships, which build consensus, which, in turn, build reality and trust. Anytime a new external input is brought to the community, it sends a ripple of consensus requests to each individual relationship adjusting the nature, or state of being, of the DAO in a dynamic manner. The moment any individual node (ego) breaks that consensus, then the DAO is no longer decentralized and dissolves, or needs to be forked into a new DAO/community to restore the balance.

This brings me back to the linked Bloomberg article at the beginning of this blog entry about Merkle receiving a $1 billion funding round. What does an external influence like this do to the fabric of an organization? Does this influx of external money erode the consensus or “faith that those in your community will see the value in your stance”? Or will it help to fortify the organization as a protocol. Farcaster is not a DAO, but I think the question still applies. Either way, I love Farcaster and if money is going to flow into a protocol, I am happy it is flowing there.

Again, I don’t have the answers to any of these questions, but I think that is the point.


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