The Importance of Early Subcultures
Defining Subcultures
Subcultures have always been a fascinating part of our social tapestry, emerging from the mainstream to shape and reshape societal norms and practices. Whether they are born out of shared hobbies, political ideologies, or specific art forms, subcultures offer a microcosmic view of our collective identity. But to fully appreciate their significance, we must first understand what they are and how they form. Moreover, we must understand their significance to leverage them in methodically adapting to undiscovered trends and opportunities, in order to cover as much evolutionary space as possible.
Role of Subcultures in Society
At their core, subcultures are tighter-knit groups within a mainstream culture that share a distinct vibe. They often form in response to specific circumstances or needs unmet by mainstream society. This invariably compels the pursuit of the deepest sum of technological impact, as many divergent viewpoints approach shared discoveries with separate coverage of slightly different markets. These viewpoints also compete to cause as much positive disruption as possible, as they typically view themselves as the underdog to an incumbent lacking in sophistication, and in doing so compound the disruptive impact of other subcultural niches.
There are several ways this can go. There can be the Ten O'Clock People, a spontaneous group activity with no other real impact. There can be an Eternal September, where the group conversation becomes mainstream and dilutes to a severe degree. There's meme culture, where there is no defined subgroup that controls a scene, but rather the legitimacy of the idea itself permeates throughout mainstream consciousness, mutating and only gaining amplification when the vibe is genuine. And, of course, there are DAOs.
Multisigs are high-context and focused between close peers, but they're necessarily small in order to sign any transaction. ICOs (including NFT mints & LensDAOs) are primitive crowdfunding, but they often leverage insider markets and inherently place trust in a fallible founding team (even a single hot wallet) and the onus of footing the bill falls on the public. MolochDAOs are more cryptopunk, offering members of a scene to self-select, coordinate, & dissipate, but they're not ideal for mass crowdsourcing. NounsDAOs are consistent, raising funds through auction of voting tokens, even nesting in many ways within each other, but the proposal structure is still prone to breakdown of coordination and can suffer simple tyranny of majority. Public goods funding like the Grants Stack leverage quadratic funding to direct preexisting pools of funds, but the flavors of endorsement and association within a given social network either helps or hinders this process.
The thing is, we're at the cusp now of having truly decentralized social media, especially a public mechanism that can directly respond to onchain events and objects. The public is further capable of coordinating financial capital for the sake of impact, but they're not captive to the whims of a cult of personality or an inscrutable, private groupchat. These things can coexist, but one has to ask, "Have we evolved this cryptoeconomic apparatus to be maximally flexible, inclusive, and revolutionary?". The other point to consider: for all the viral moments, where spontaneous, unplanned coordination takes place, can DAOs be molded to that subculture, and can we convert the momentum within a mechanism that allows for long-term sustainability and natural exit at the same time?
Sugar and Life
Life uses organic chemistry in a variety of mechanisms that become more expressive and sophisticated over very autonomous layers. Autotrophs act as a virtual “Maxwell’s demon”, converting ambient resources into chemical energy, mostly n-carbon sugars.
This demon also has siblings: one variant compliments hot, oxygen-rich environments by changing one sugar in the cycle to spatially displace the process, another variant compliments hot, dry environments by temporally displacing the gas exchange of the process.
Cells “respirate” sugars and convert other molecules near semi-permeable membranes to act and build further.
They shift form and mutate by offloading control logic complexity to the rules of their surroundings (epigenetics), and they thrive as much as the scarce resources in their environment act as limiting reagents. We can even experimentally demonstrate very unintelligent organisms solving puzzles, only using sugar in this way. And as these cells age and lose their value, they often self-terminate or are otherwise replaced by other cells that fit the niche. Larger organisms build on top of this cellular automata by forming superstructures that are just stable enough, and just reactive enough, layer by layer. At a high enough level, we end up with very complex, mobile organisms, and the ecology that develops around these levels is considerably more expressive and more esoteric. Instead of this sugary biomass drifting towards to the apex of the foodchain, the “sugar economy” forces new morphologies, along with new ecological niches, by keeping the mass at the bottom and selecting for more “fluid” species just above that foundation. Mass extinction and natural disaster hits the top-heavy organisms but cannot be extensive enough to entirely remove the autotrophic foundation. I think DAOs can engage in a little biomimicry to achieve the same benefits (more on that later).
Filtering Out Bad Actors and Cultivating a Pipeline
Identifying Bad Actors in Subcultures
I just read a very interesting take about subculture classification. In essence, the core subculture's dilution can first be articulated as a cohort of fellow geeks that just don't do the important work (done by so-called creators/developers), but do peripheral work and spread the vibes (so-called fanatics). When the subculture is truly at risk of mass adoption, then a bunch of low-context individuals (so-called mops) start to impede the core cohort (the developers) and also provide a fresh target for grifters (so-called sociopaths) to contaminate the resources in the "geek" core. Once exposed enough, enough bad faith will eat at the original resources, either in the form of sociopaths or mops.
To defend against this dilution, often subcultures isolate themselves, drawing ideological boundaries around the core "scene". This exclusivity is a totally reasonable defense mechanism, but it is reactive all the same. DAOs might "upgrade" their governance structure to install privileged classes with powers of oversight, excommunication, and veto, but in turn they are accepting the ethical cost of misappropriating the "flatly-organized" consent of the original capital providers (even if there is no explicit majority dissent).
Furthermore, a subculture that exists as an island under attack doesn't really help the global intent to grow and evolve. This defensive behavior can often produce denialism or toxic maximalism, or the use of pejorative language for transactional behavior on the fringes, if left unchecked. Point being, if it's not thriving as nature intended, then the progressive goal is clear: sustainable DAOs of subculture should passively filter bad actors by their conduct, especially if most of their method of attack is social engineering. They should also figure out the lowest common denominator of contribution and compartmentalize all behavior in that ballpark so it cannot contaminate the core scene. However, it's worth considering that nature still interacts with organisms if any sugar's involved.
Encouraging Growth: From Neophytes to Acolytes
Society isn't always that murky. A majority of humans learn to work harder, at first to learn and earn spending money, then work smarter over time to earn other forms of capital. A middle-aged adult will keep more money in investments, and a retiree will minimize consumption to stretch out savings and capital gains from past investment. Throughout, all humans trade social capital (but in far less quantifiable way) to ideally achieve higher social standing over time.
it's important to keep in mind that, while more eminent members of society technically have equal votes with everyone else, their soft power in a Keynesian economy actually increases over time, which can lead to a gerontocracy in democratic republics. This also applies to firms (the entities that offer goods & services) as they mature:
And it also applies to financial investment as bigger pools of capital might become risk-averse, or seek risk-adjusted yield, or multiples of return if their risk appetite is high enough. A good portfolio with no other edge will place many bets, in the hopes that they acquire as much financial growth as possible. A question that should be asked about any DAO, on the other hand, is what variety of investment and risk appetite can complement the given structure, from a groupchat multisig or a coinvoting contract, all the way to an entire global network's consensus mechanism. Berachain is one example of a consensus mechanism that might progress from smaller-cap liquidity, towards low-risk, high-Sharpe mechanics overall as its network matures.
Unfortunately, this concentrated capital can have its own runaway effect, as crony capitalism or angel-to-IPO financing shifts into plutocratic control over further income.
Just to clarify, this is not about a condemnation of a school of thought, it's just a failure mode that a decently-designed public DAO has to confront as a potential surface of economic exploitation. The main reason to avoid this outcome is that it's ossification, in other words the control of the apparatus is less replaceable and less generative of a possibly positive-sum economy in the future.
Part of the challenge in creating a healthy ecosystem of contributors is figuring out the rotation of the most eminent members such that their net capital gain is unimpeded without extracting public capital, and making sure that a significant portion of the treasury is always controlled by the optimal balance of context, consent, and active "acolytes" that are the most up-to-date in unrelated trends (i.e. potential growth). This means that the most-capitalized members, in an improved DAO, still control the longterm impact they'll be credited with, but they will have to implicitly trust more of a governance structure that acts on its own for the sake of overall growth, especially due to the fact that it will grow on innovation and economic windfall instead of what a zero-sum market will bear. This also implies that the lowest-capital members need a codified path, instrument by instrument, that shows them how to learn and progress towards the inner layers of the DAO, without paying them in JPEGs or digital scrip. Or maybe there's a way to do both (explained below).
Self-Evident Synergy and Suboptimal Hype
Culture is a funny, mercurial aspect of sentient life. It's partly animalistic, partly codified, and between both, there's some sort of dynamic coordination and broadcast of valuable conduct. This is really where nature can't keep up with human civilization. We seem to have a behavioral "Konami Code" when people "jam together", "meet up", and other versions of Schelling points. What is an ERC-20 or NFT in this context? A group of people have mainly one activity to share: buying something that can be speculatively discussed. One trick to a "blue chip" (read: more socially coherent) token is that it has really attractive peripheral activities. The "soul" of the project can translate well beyond ownership, and like meme culture, even low-context outsiders know how to vibe further and get closer to the value that accrues to that.
On the other hand, a "network spirituality" vibe is great and all, but that doesn't mean that there's a rhyme or reason to building a sustainable future. For example, ConstitutionDAO really took off at the peak of the market cycle, and there was a moment where we all believed that this extra financial value laying around could be coordinated en masse, towards a singular impact we all vibed with. In retrospect, I was wrong in thinking that there really was such a clean opportunity, and moreover, the design in ConstitutionDAO and other impact DAOs is not sufficient. If they achieve anything longterm, it will be despite the hype for the initial crowdfunding, despite the method of governance they use to manufacture legitimacy for the enterprise as it relates to the original scene.
Permissionless Mechanics: Cultivating Optimal Social Physics
In the school of "Social Physics" (which I do recommend as a conversation-starter), the mechanics are kind of like a pressure chamber with some analogue to the universal gas law. Instead of figuring this out from theory, the researchers behind this measured social interaction in several ways. Without getting into the weeds, one of the examples they used was eToro's "copytrading", where traders can just follow the strategies of other traders. As a matter of course, they found two polar opposite situations that produced suboptimal ROI:
There were isolated, divergent traders that didn't copy or weren't copied at all, and traders that did nothing but copy the other traders, get copied by the other traders, and eventually copied themselves by proxy.
It's important for anyone invested in the longterm success of Ethereum to appreciate that, a subgroup limited to a single implementation, or a protocol that is limited to a single strategy, may outperform competitors, and if left unchecked, dominate the network until the concept of autonomy is no longer defendable. If we want to create something that naturally thrives on the network and compels the best evolution of that network, then it must be some kind of open specification, implemented in parallel, with a peripheral array of tooling that is just decentralized and divergent enough, to yield a better outcome that isn't just a copy of itself. DAOs, in this spirit, need to have some structure that isn't limited to the same fungible token, the same token-gated forum, and the same insider scene that requires volunteerism, or speculation from the outside going in. They need a comprehensive array of tokens that are equally applicable to an echo chamber, sybil attackers, and anyone in between that is semi-rationally considering the benefit of investing value to receive a corresponding token. The trick will be treating the token(s) as a measuring stick for commitment, and have several structures in place to promote a healthy progression.
Self-Propagating Proof of Attendance
At the heart of our model is a self-propagating Proof of Attendance (spPoA). For each organizational event, an ERC-1155 contract is deployed. Users pay a toll, effectively pricing the value of the public good they enjoy from a token with given ID value, where trust dilutes as that ID value increases. A decaying pricing mechanism facilitates no-trust minting, providing the foundation for the event. for example, the following function where y is the minting price.
To make this self-propagating and trustworthy, the secondary minting mechanism is anyone with the initial token signing a message proving ownership of a preexisting spPoA with a given id [m], generating an ephemeral minting link, and the following minter using this endorsement to mint a token [n] for a price reduction (open for design), dependent on the value of [m] (possibly a metatransaction).
Additionally, there would be an increasing cap on mints, up to potentially millions for the maximum ID, but most certainly only hundreds or fewer near the core, proportional to Dunbar's number.
One caveat to this apparatus is that there's probably no perfect answer to the implementation of it (and there is clear room for improvement with the example above). There might be a certain amount of trust given to a relayer for minting metatransactions, there may be multiple factory contracts, or possibly even an ERC-6551 architecture where the ownership itself is a transferrable, multi-DAO NFT, and the 1155 tokens within are NFTbound. It's also important to imagine that a soulbound spPoA is more sybil-resistant and less financially exploitable, so it should definitely be an option, if not the default.
e.g Alice trustlessly minted a token[10] for ~1 ETH , she signs an offchain message that she owns it, generates a dynamic IPFS link that includes the tiered offerings to mint tokens [11]-[50] with descending prices through a relayer, and Bob uses Alice's signature in a metatransaction to mint token [20] for some reduced price. Bob performs the same URL generation flow as Alice, and Charles mints token [30] for some reduced price, etc.
This ERC-1155 should also split the proceeds to several treasuries, let's call them [a], [b], and [c] (though it could be many more). For each treasury, there would be a separate gauge of voting power for controlling a portion of that treasury. imho, each treasury should also have its own version of locked, yield-bearing tokens (especially Ethereum LSDs). [b] should have the largest portion, followed by [a], followed by [c]. The other thing to keep in mind is that proposals will need to be shared to each ring, depending on the desired scope.
There should be incentive for low-trust holders to spend more time &/or ETH, to acquire context & provenance in order to increment towards the core. Core should be more active in connecting/constructing independent elements as delegates/oracles/brokers, i.e. the core is the vault where the autonomous software and mechanisms, that are just decentralized enough, exist. The ideal "torus" of the deepest-governed treasury should sit with really active, mid-context, highly decentralized actors. In this example, that would be [b], for the sake of versatility.
When deploying the event contract(s), there could be some way of demonstrating the "cofounders" are numerous enough that they cannot collude and overwhelm the governance. This probably means that the initial "ragequit" should be mirrored by a locked "stake" (at the top of the pricing curve) that gradually gets more redeemable the more that others stake alongside them. Again, I admit it's worth modifying. If [a] requires this, then [b] should be more of a staked position, but cheaper when minting from [a]'s kiosk, same again with [c], and so on. once there's enough provable distribution, there should be enough proof to determine when a given token [n] will be fully redeemable for the initial stake ([b] might be redeemable the soonest if its treasury is allotted most of the distributed LSDs). [a] should end up being the riskiest to mint, as most of its price is being split to the [b] treasury and some lesser fraction going to the [c] treasury, but it will be the first to benefit when the core perks are deployed and active. [c] should be least risky to mint besides [n], but so lacking in voting power and ability, to necessitate the formation of multisigs, borgs, and other ways of "anabolizing" at a more competitive pace. (explained further below). And if there's too much risk to begin, the initial group can initially pool resources to mint a low-index gate to really discounted secondary mints in [b]-[c].
Class [a] doesn't necessarily signify the lowest possible index, but it is the threshold under which incentives must switch from DAO governance to high-trust, high-risk financial resources (undercollateralized curated credit/private orderflow/API access/declarative-as-oracle rights), instead of public funds. this should also be significantly higher than [0] so earliest adopters can trust that no one actor has irrevocable status/control/access when initially distributing proofs of attendance. this inevitably becomes the most rivalrous part of the structure, so it needs to have positive-sum, evaporative incentives for top performance and ways to exit or "catabolize" from the core (explained below).
Class [b] should be the optimal balance between a well-protected treasury and progressive idea flow. the proceeds for the entire 1155 mint, while distributed to other layers, should favor this most of all. also, if any part of the DAO manages LSDs, then [b]'s gauge voting power should be the most resistant to bribes. This cannot be designed as a rehypothecation of Ethereum's consensus mechanism, instead it should be credibly neutral and rebalance away from any centralized stake.
Class [c] should be less than capable of distributing tokens of IDs over [c], such that the economics of a sybil attack are too costly to hit [b], but the lack of context/association with low-trust members does not exclude them from beginner resources. This is also where the incentive to provide "redeemability" should be emphasized, so it's easier for low-context, low-consent agents to decide how to contribute. lower IDs should be less fluid and more costly to acquire, but higher IDs like [c] should be attainable and redeemable.
Class [n] is a soulbound piece of dust. it is the maximum ID value that can still be minted for the event, but without further nonfinancial capital like participating in online discussion, or producing significant proof of work or impact, it should remain valueless to governance and any redemption function. It's important to keep in mind that even airdrop farmers contribute many forms of value by holding part of the overall contract, but also by holding only the [n] parts and marking themselves as that baseline contributor.
Low-Trust Sybil Resistance and Peripheral Functions
Like sugar, some tokens should be sticky and some tokens should only be digestible by specialised entities. Ideally, I'm hoping to convey that some DAOs could serve as connective tissue, either as being superficial to preexisting DAOs or being a factory for further sovereign DAOs later on. Like hypercerts, many of these spPoAs, minted from separate ERC-1155 contracts, could get merged retroactively. That could be very useful, if privacy-preserving, in the context of any major, culturally significant assembly. Furthermore, any treasury can trustlessly mint a very low-index token to autonomously gate the slightly-higher-index reward for a given activity (or onchain proof). No reason to keep coming up with stressful convolutions to airdrop farming; there doesn't have to be a POAP or an ERC-20 airdrop if those don't serve any benefit. Each treasury might retroactively upgrade their consensus, and like offchain sigs like Snapshot, use spPoAs from multiple contracts, if not many other onchain objects as well.
Multisig kiosks might be a peripheral idea, where a minimum of [m] kiosks need to be scanned in sequence to mint an [m] (unless saturated); [m] has to be equal or greater than [c] to prevent a non-financial attack on [b] or lower.
The steeper the pricing drop, the narrower the [c] of multisig kiosks. In other words, optimal social density should not be captured by either a colluding core or a distributed sybil attack. keeping a static minimum index, making IDs below [a] more evaporative, and throttling the max value of [c], might be necessary defensive measures to protect the DAO.
Since nature likes to leverage spatial and temporal displacement, maybe the secondary minter could initially mint a low-trust, dynamic NFT that allows them to scan links at different locations and sign to confirm their own location. maybe the minting site refreshes its signature, minute by minute, so the pricing gets steeper when enough time passes. There's probably more than a few ways to demonstrate that a minter is sybil-resistant and present at the event, and/or actively contributing, in some way. It shouldn't take a centralized code generator or a scanned eyeball to achieve this quality.
In order to reinforce evaporative merit, the DAO may have to periodically initiate a "senescence function" from an aggregated source of truth, if it cannot directly increment high-trust tokens automatically. This might involve the creation of a merkle tree of all the token holders that meet a certain proof of impact/work and a merkle tree of those without, which should be relatively easy to calculate and verify between so many oracles/provers near the core. here's the key, though, reinforcement should punish the underperformers more than the overperformers benefit. in other words, there should be an opportunity for the addresses of the underperforming merkle tree to voluntarily demote themselves for a lesser "catabolism", otherwise the trouble of finalizing this senescence function should lead to a mass "anabolization" of the overperformers (including qualifying [n]) in a new contract, excluding the underperformers and all 1155s under a given ID. Another way of explaining all of this: the DAO should constantly evolve to include new addresses in an attempt to shake off underperforming old addresses and zero-sum governance that tries to capture [a] through [c]. This could also be used over scheduled epochs to automate a certain work ethic; how productive are the transcribed meetings, which members coordinate around the globe to keep their forum active 24/7, etc.
Over time, a long-lasting version of this DAO should accrue a very extensive mapping of freeriders, politicians, and farmers that will no longer access most treasuries, which can be a public good in the eye of the beholder. it should also experience enough churn to keep growing the yield-bearing positions in multiple treasuries, always increasing the possibility of redemption over time. Furthermore, this is an opportunity to curate certain activity, like privatize orderflow, software repositories, and knowledge graphs, to the DAO's core if it's legitimately, positive-sum neutral. I can't imagine that this is all that can be composed around spPoAs, but it's a start.
Retaining Trust and Cross-Capital Interchange
One goal that all organizations should have is deepening the intrinsic value of the objects that represent membership. One thing to always keep in mind is that compartmentalizing the treasuries can be complemented by layered proposals that solicit funds from all treasuries at once. Another thing to consider is that we can invoke the so-called "long-tail incentive" used by MIT in the Red Balloon challenge:
Not a particularly complex mechanism. The bounty issuer pays twice what the worker wins, and everyone else competes to be closest to referring the worker that will win in order to get a quarter of the winnings, or an eighth of the winnings if they refer the person who refers the worker, etc. This alone could be applied to such things as journalism, technical writing, additive moderation, and other low-context, high-quality activities. The question is whether this applies only to distributing funds for a bounty proposal, or if it can directly apply as an arbitrary PoW for a given group of token holders to decrement their spPoA proportionately as they coordinate to gain trust.
Again, senescence could be used to better serve the broader DAO, but in the case of demotion incentives, it can also be an opportunity for a tokenholder to rebalance their commitment to a maturing enterprise in order to invest in riskier, nascent Schelling points. Just like biology builds up stores of chemical energy, it too depends on organisms to respirate that chemical energy to act, so in turn there might be a mechanism to incentivize lower-[n] tokenholders to convert into higher-[n] tokenholders. or, the incentive could be just enough to subsidize the redemption value of a given token[n] for a limited group that want to leave the DAO altogether. We don't want to avoid the MolochDAO ragequit, it's a profoundly important function that keeps any DAO in check. Hopefully, the initial parameters in this design show that there may be different ways to extend the ragequit into a more fluid signal without removing the promise: exit from the DAO has been made as easy, trustless and economically riskless as possible. If this or another DAO's design is too flawed to uphold a ragequit with enough time, it shouldn't be used to begin with.
DAOs are essentially a method of account between consent, goods, and services. We've taken on this design space with the intention of creating a better numeraire for economic exchange. Why then, would the DAO need to have liquidity for only goods and services, if its governance power has to be liquid in a similar fashion? So one peripheral concept to keep in mind is that there should be an incentive for members to deploy multisigs and BORGs, because they can in effect partly internalize the bargaining & transactional costs of the larger DAO. The only consideration as far as security: these grouped tokenholders of a spPoA need to be transparent enough for a 1/n trust assumption that someone on the inside will "blow the whistle" if there's abuse or exploitation.
This is also great as far as legal liability. Self-sovereign DAOs should never be enveloped by a single LLC, but certain subsets of their activity might be best assumed by LLCs to compartmentalize any legal liability. With the idea that a DAO can automatically set a gauge for entities like BORGs to accrue value, we can lean further into the DAO's governance structure as a method of account. The spPoA might not be tradeable as a security, but it can still be metabolized as an analogue to the "sugar economy". There may even be a way for multiple legal entities, displaced across many jurisdictions, to agree to set pools of spPoA increment/decrement, independent of any currency exchange. I don't know where that's headed, somehow it's exciting all the same. And, of course, this can be series of events with transposed spPoA values, leading to slightly decentralized entities gaining international capital over time, for the services they provide.
The point to all of this is that the spPoA is a point of reference for many organizational maneuvers, and the organization itself can be adaptive enough to expand, contract, or nest within itself in order to best serve the subculture and mainstream without sacrificing the interests of any side. spPoA governance can coordinate resources, establish longterm scopes of impact, but also reinforce an accountability for each "capitum" within the DAO. While it's been clear that we need something that's more cohesive outside of the usual tokenomics or "club" DAOs, I think we also need to consider that we'll need to corral autonomous agents once the software reaches a certain stage of maturity. There ought to be a way to make them rivalrous and credibly neutral within the same system, while also benefiting the larger public.
4. Conclusion: Balancing Inclusivity and Integrity for Evolutionary Pressure
In conclusion, this DAO architecture attempts to mimic the chemical economy of life, gathering accountability from ambient resources, creating local points where members can "respirate" themselves away from the core, and "anabolize" themselves, through active participation, towards the core. It allows for low-context progression, it tolerates unaligned actors that contribute for tokens without contaminating the central subculture, and it can be used as a method of account outside of central exchanges or AMMs, and like NounsDAO, it can be nested. Ideally, this would be private through the use of Sismo and would leverage account abstraction and rollups on Ethereum to facilitate adoption by mainstream, non-crypto users. This is still very much a work in progress, I don't know how it can be attacked, and I still need to work on potential implementation(s). That being said, I hope this framework sparks some conversations on how DAOs can be redesigned to serve many subgroups and many goals with independent scopes, all at the same time.
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