https://www.newyorker.com/culture/infinite-scroll/the-promise-of-daos-the-latest-craze-in-crypto Skip to main content The New Yorker * Newsletter To revisit this article, select My Account, then View saved stories Close Alert Sign In Search * News * Books & Culture * Fiction & Poetry * Humor & Cartoons * Magazine * Puzzles & Games * Video * Podcasts * Archive * Goings On * Shop Open Navigation Menu To revisit this article, visit My Profile, then View saved stories Close Alert The New Yorker New Yorker Favorites * The Long Afterlife of a Terrible Crime * Is "Mein Kampf" Still Dangerous? * The Search for a Sober Buzz * "The Far Side" Returns Infinite Scroll The Promise of DAOs, the Latest Craze in Crypto The blockchain business model has made headlines for sensational ploys. But in quieter corners DAOs are forging a promising new ecosystem for digital startups. By Kyle Chayka January 28, 2022 * * * * * Save this story for later. Interconnected red blue and purple lines and dots flashing in a circle configuration. Illustration by Nicholas Konrad / The New Yorker * * * * * Save this story for later. In November, an online collective called Spice DAO bought a copy of a "director's bible" for Alejandro Jodorowsky's "Dune," the nineteen-seventies film adaptation that famously failed to come to fruition. The group paid nearly three million dollars at auction, about a hundred times the book's estimated price. DAO, which stands for "decentralized autonomous organization" (and is pronounced "dao"), is an increasingly popular term, in the world of cryptocurrency, for a bunch of people who have pooled funds to accomplish a particular task. They are "digital flash mobs with money," as Raihan Anwar, a manager of a DAO called Friends with Benefits (F.W.B.), told me, and in recent months they have rivalled non-fungible tokens, or N.F.T.s, as the most hyped concept in blockchain technology. Spice DAO had launched its own cryptocurrency token, called SPICE (a reference to the mystical substance in "Dune" 's sci-fi universe), and sold it to raise more than seven hundred thousand dollars to purchase the book. The rest of the price was personally fronted by the DAO's co-founder Soban Saqib. The group's plan was to produce its own version of the film, with creative decisions voted on by the token's holders. There was only one problem: owning a single copy of a vintage art book is in no way equivalent to possessing the intellectual property of "Dune." The DAO members had no more license to produce a version of Jodorowsky's film than they had to make the next Marvel superhero movie. Spice DAO's half-baked undertaking is just one of the recent stories that have been touted as evidence of the crypto economy's recklessness. In November, a group called ConstitutionDAO raised forty-seven million dollars in cryptocurrency to bid on one of thirteen extant original copies of the United States Constitution--and then lost the auction to Ken Griffin, the C.E.O. of Citadel. Other DAOs have announced plans to buy a golf course (LinksDAO) and an N.B.A. team (the Krause House DAO); one, called CityDAO, purchased land in Wyoming. But these sensational stories give only a partial picture of the burgeoning DAO phenomenon. A DAO, by definition, is simply a business structure, akin to an L.L.C. or a C-corp. They are usually made up of a custom cryptocurrency, or token, and an online community space, such as a chat room on the platform Discord. The community holds internal discussions and then votes on decisions using the token, on apps such as Snapshot, the way one might slip a piece of paper into a cardboard box to elect a class president. The more funding you put in, the more slips of paper you get. DAOs promise that an organization's decision-making will lie with a wide group of members rather than with, say, the tiny elite of a corporate board. In quieter corners of the Internet, this structure has shown promise, forging an ecosystem for digital startups outside Silicon Valley. New Yorker Favorites * Is Ginni Thomas a threat to the Supreme Court? * A buried Viking treasure was worth a fortune--but it became a nightmare. * How the idea of Hell has reshaped the way we think. * A slightly unreal pandemic pregnancy. * The creation of Cleopatra. * A trip to St. Kilda, Scotland's lost utopia in the sea. * Humor by Mindy Kaling: "A Perfectly Reasonable Request." Sign up for our daily newsletter to receive the best stories from The New Yorker. [kyle_chayk] Kyle Chayka is a contributing writer for The New Yorker and the author of "The Longing for Less: Living with Minimalism." 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