A key achievement of the flawed The DAO: its ability to organize a few thousand database entries which gave scattered strangers a shared purpose is now being built upon to aim at something bigger.
According to Niran Babalola, Product Engineer at ConsenSys, The DAO which eventually led to a hard fork was able to prove that Ethereum can give the toolkit to create brand new and useful shared ideas. It also showed that there are enough people who share the idea that Ethereum transactions are meaningful - The DAO approved a proposal; the contractor and DAO token holders perceived a transfer of value.
Though millions of dollars are locked up in Ether, not a single person has been required to acknowledge the Ethereum transaction.
Zero dollar DAOs
Despite these opportunities however, an attempt to create a new DAO now will face a tough hurdle particularly in making people put their money into a complex contract. Hence, the proposal to build useful shared ideas which unite people in purpose without the ability to convince thousands of people to part with their hard-earned Ether.
According to Babalola, who founded Benefactory as a ConsenSys product, the idea is a revisit to the one token, one vote concept of The DAO - assigning voting rights up front to people who deposit funds. Now, the barrier to entry is being removed by assigning those rights later instead.
Babalola says to Cointelegraph:
“Benefactory commonwealths are zero dollar DAOs. The big difference from existing DAO concepts is that commonwealths don't hold funds. Instead, the funds go directly to grant recipients, but the grant contracts keep track of how much each person has contributed. A commonwealth is just a collection of crowdfunded grants toward a shared mission. Contribution amounts can be displayed to the public, but more interestingly, the amounts can be consumed by other contracts. A voting contract like Carbon Vote can easily be built which uses commonwealth contributions instead of ether, so commonwealths can speak with one voice and democratically decide what counts toward the commonwealth’s mission.”
What to expect
Babalola, who helped build Augur and Gnosis, said commonwealths will change today's cryptocurrency ecosystem by making it easier for communities to take action together.
He said:
“There are so many things our communities would do together if it were easier, like build developer tools and spread news about the technology to more people. Any time there's an opportunity to add value to our communities, anyone can take the initiative to make it happen and their contribution will be recorded on the Blockchain forever. The recognition for contributions and the group identity commonwealths provide might be enough to motivate our communities to do more together.”
Why Ethereum
Benefactory and the commonwealths it manages run on Ethereum as, according to Babalola, “It is the most mature and interoperable platform for defining new social and economic interactions that can occur without middlemen.”
“There's no reason to use anything else,” he said. “It's not about competing currencies. I hope more people stop investing in cryptocurrencies and start reading the Ethereum documentation so they can build apps instead.”
On what should be anticipated as a possible challenge to the project, Babalola said Benefactory is a new design for organizing communities.
Hence, there's no way to know if it will actually work well for communities until it’s being used.