“The collaboration-maxi nature was a welcome breath of fresh air.”
Increasing numbers of employees are quitting 95 corporate jobs to work for DAOs. While the moneys great, DAOs fall into a legal gray area, and it can be tricky to get your foot in the door.
Researchers Nataliya Ilyushina and Trent MacDonald from the Royal Melbourne Institute of Technology Blockchain Innovation Hub take you through how to get started.
This year could see two emerging workforce dynamics come to a head. Twenty-one million Americans quit their jobs in 2021 heralding the Great Resignation era after an extended experience working remotely during COVID-19 lockdowns and dissatisfaction with conditions upon reentering their workplaces.
One in 5 workers reported an intent to quit their jobs in 2022. At the same time, the peak number of members of decentralized autonomous organizations at the start of August 2022 was 3.4 million, with over 140,000 new members joining in July 2022 alone.
Although the Little Migration to DAOs pales in comparison to the Great Resignation, we might still wonder if these two trends are connected in some small way.
For one, the demographics of both groups are strikingly similar: workers typically between 30 and 45 years old and with the tech industry most affected. Secondly, DAOs are digitally native organizations and a natural fit for many of the disaffected workers seeking new remote employment opportunities.
So, why are people migrating from working in traditional corporations to become digital nomads working in new settings such as DAOs? Could this be your next career move?
DAOs are a new form of organizational structure offering an alternative to corporations. For workers, the critical difference is the horizontal structure, where there is little formal hierarchy and no bosses.
DAOs offer a revolutionary new type of employment: a hybrid of ownership, traditional employment, freelancing and volunteering. Every member is a boss and a worker (both paid and unpaid) and is free to contribute when and where they see fit. Each member is free to choose how much time they want to spend working, voting and participating in discussions. Moreover, one can be a member of multiple DAOs and choose how much time and effort they devote to each.
According to DeepDAO, numerous top DAO contributors are members of dozens of DAOs at once, with the most prolific contributor currently part of more than 80 DAOs. In other words, employment in a DAO is flexible, discretionary, overlapping and deregulated.
DAO employment offers considerable worker flexibility in terms of their overall supply of labor, working hours and variety of tasks due to the digital, remote and asynchronous nature of DAO operations.
Today, it is possible to earn a living working for a DAO or across multiple DAOs, with some earning as much as $300,000 a year in 2021. A survey of 422 DAO members conducted by Gitcoin and Bankless showed that half of the respondents were able to earn a living from working in one or more DAOs.
A long road to be paid
However, the remuneration rarely comes as a traditional salary and is commonly paid in tokens. Furthermore, the moment one starts working for a DAO and the moment they get paid can be two entirely different points in time.
Here is how the evolution of working for a DAO typically looks. The moment one joins a DAO (usually by purchasing a token), they can start contributing by participating in a community forum (often on Discord) and voting (using Snapshot or something similar). At this point, however, there is a slim chance of getting paid. As ones reputation grows, the DAO community may reward them based on discussion and participation KPIs (usually via airdrops).
Once a member has familiarised themself with the DAO and proved their reputation, they might start contributing to the core DAO project. At this stage, this usually happens in the form of completing a bounty: a small, disconnected task. Bounties are paid and lead to further accumulation of reputation and DAO-specific skills.
Not everyone is skilled to work for a #DAO right now.
A DAO in its current form requires skills not everyone possesses, and thats ok.
A lot of ideas are still getting tested, and there wont be one single way to work in a DAO there will be many.
ivanlozada.eth _ (@ivan7538) September 6, 2022
The next step is to secure a part-time or full-time position within a DAO. While relatively rare and hard to get, these jobs are very well-paid. Longer-term or ongoing positions such as these are usually associated with the core operations of the DAO project: for example, a software developer role in a protocol DAO or a graphic designer role in an NFT art production DAO. If one does not want to have a fixed arrangement, they can continue contributing when convenient, and the peer review process will decide how to remunerate the value they add to the DAO.
Everyones story transitioning to work for a DAO is different for example, an anon dev called Squelch tells Cointelegraph he went through this entire typical lifecycle of DAO employment in merely a week.
Before joining DAOs, they built carbon market trading exchanges and natural disaster insurance, worked in investment banking, and helped to create an alternative interest rate benchmark to Libor called Ameribor and ran an insurtech company.
Theyve been interested in blockchain since first hearing about Bitcoin in 2009, but it wasnt until the DeFi summer in 2020 that they began to spend every waking moment learning about protocols and smart contracts.
It was still a big leap to ditch their eclectic financial services job but took the plunge when they saw a job ad for Tracer DAO (now Mycelium) looking for someone to build a decentralized derivative. After chatting with the Tracer people, it turned out they idolized Richard Sandor, who was Squelchs mentor.
I jumped on a call with and told them about my experience, and they asked me to be a pro-bono type advisor to the project. Within a week, they asked me to join as a full-time paid contributor and, a week later, asked me to run a core team providing services to the DAO.
Despite earning big bucks in their prior role, money didnt come up in the Tracer DAO chat, and it rarely comes up as the main motivation for joining a DAO. Most say the appeal is in no longer working for a boss. The absence of a hierarchical structure promotes teamwork and the feeling of being part of a community. DAO contributors often mention the fairness and transparency of the organization. They operate like worker collectives operating via blockchain in which each member has a say about how to reward the work of others. The community makes all the decisions.
The collaboration-maxi nature was a welcome breath of fresh air, Squelch says.
It is interesting in that you are connecting and collaborating with people that are also passionate about similar ideas and ideals. However, the challenge is creating coordination mechanisms and incentives so that everyone is working together in tandem to help solve these goals.
They go on to add, Even with the struggle of working in a DAO structure, I see them as being incredible tools to bring people together full-time, part-time and every so often to help bring things together.
Irregular hours and no job security
The benefits of decentralization and deregulation also come with risks.
The flexibility of the work comes with a lack of job security and employment entitlements. Like rideshare drivers and other gig economy workers, who work when they want but often do not receive the same entitlements as standard full-time employees, DAO workers are not guaranteed sick, maternity and annual leave provisions.
Blockchain law expert Aaron Lane from the RMIT Blockchain Innovation Hub says that working for a DAO is in a regulatory gray zone at present. There are established legal tests in most jurisdictions about whether someone is treated as an employee or an independent contractor, he says, adding, Organizations structured as a DAO cannot limit its liability just by virtue of that structure.
DAOs are not immune from other issues, such as workplace discrimination and harassment, but their deregulated nature does not easily allow the prosecution of those practices. After all, which jurisdictional authority does a global DAO fall under?
The Hustlers Guide to making $1M+ working for DAOs or Web 3 projects.
The 10 DAO Commandments
The 7 Figure Crypto Consultant (@BowTiedDAO) September 3, 2022
The lack of job security and a legal framework might discourage women from joining if they are worried about the lack of provisions for careers or maternity leave as well as the overall perceived high-risk nature of the industry. There is no data on those issues yet, but it may be one factor in the lack of gender balance in the sector. A Bankless survey of DAO members found seven times more males than females.
But Lane remains optimistic: While critics may say that there is potential for workplace rights to be eroded under a Work-for-the-DAO model, workers have a lot of power, as blockchain and crypto skills are in high demand, and this new technology could actually allow new forms of collectivized employment terms to emerge.
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While DAO employment still needs to be more clearly defined, there are significant benefits, and its only set to rise throughout 2022. The new employment relationship is attracting talent by offering flexibility, transparency and ownership along with the prospect of generous remuneration.
And the few risks posed by the deregulated nature of DAO employment do not seem to have hampered the growth in DAO membership yet. How all this plays out with respect to the Great Resignation is still unknown, but DAOs have been picking up at least some of the slack in terms of employees moving away from traditional corporations during the pandemic.
bitcoin ethereum blockchain crypto pandemic covid-19 crypto
SEC initiates legal action against FTX’s auditor
The SEC alleges that Prager Metis, an accounting firm engaged by bankrupt crypto exchange FTX in 2021, committed hundreds of violations related to auditor…
The SEC alleges that Prager Metis, an accounting firm engaged by bankrupt crypto exchange FTX in 2021, committed hundreds of violations related to auditor independence.
The United States Securities and Exchange Commission (SEC) has commenced legal proceedings against an accounting firm that had provided services to cryptocurrency exchange FTX before its bankruptcy declaration.
According to a Sept. 29 statement, the SEC alleged that accounting firm Prager Metis provided auditing services to its clients without maintaining the necessary independence as it continued to offer accounting services. This practice is prohibited under the auditor independence framework.
To prevent conflicts of interest, accounting and audit tasks must be kept clearly separate. However, the SEC claims that these entwined activities spanned over a period of approximately three years:
“As alleged in our complaint, over a period of nearly three years, Prager’s audits, reviews, and exams fell short of these fundamental principles. Our complaint is an important reminder that auditor independence is crucial to investor protection.”
While the statement doesn't explicitly mention FTX or any other clients, it does emphasize that there were allegedly "hundreds" of auditor independence violations throughout the three-year period.
Furthermore, a previous court filing pointed out that the FTX Group engaged Metis to audit FTX US and FTX at some point in 2021. Subsequently, FTX declared bankruptcy in November 2022.
The filing alleged that since former FTX CEO Sam Bankman-Fried publicly announced previous FTX audit results, Metis should have recognized that its work would be used by FTX to bolster public trust.
Concerns were previously reported about the material presented in FTX audit reports.
On Jan. 25, current FTX CEO John J. Ray III told a bankruptcy court that he had “substantial concerns as to the information presented in these audited financial statements.”
Furthermore, Senators Elizabeth Warren and Ron Wyden raised concerns about Prager Metis' impartiality. They argued that it functioned as an advocate for the crypto industry.
Meanwhile, a law firm that provided services to FTX has come under scrutiny in recent times.
In a Sept. 21 court filing, plaintiffs allege that U.S. based law firm, Fenwick & West, should be held partially liable for FTX's collapse because it reportedly exceeded the norm when it came to its service offerings to the exchange.
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DOJ readies witnesses in Bankman-Fried trial, highlights FTX asset management
The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX.
The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX.
The Department of Justice (DOJ) has confirmed its intention to summon former FTX clients, investors and staff as witnesses in the upcoming trial involving Sam Bankman-Fried, the former FTX CEO.
The DOJ submitted a letter motion in limine on Sept. 30 describing the witnesses it intends to call concerning FTX’s treatment of customer assets.
The testimonies intend to provide perspectives on the interactions between the accused and the witnesses. It also aims to get the witnesses’ understanding of Bankman-Fried’s remarks and conduct, particularly regarding FTX’s asset management. The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX, believing that the platform would safeguard them securely.
Furthermore, a situation has emerged concerning one of the DOJ’s witnesses, “FTX Customer-1,” who resides in Ukraine. Given the ongoing conflict in Ukraine, traveling to the U.S. to provide testimony is associated with difficulties. The DOJ has suggested using video conferencing as a viable alternative. However, Bankman-Fried’s defense has not yet approved this proposal.
Nonetheless, the legal team representing Bankman-Fried, led by lawyer Mark Cohen, has voiced concerns about the jury questions put forth by the DOJ. According to Bankman-Fried’s defense, these interrogations insinuate guilt on Bankman-Fried’s part, potentially undermining the principle of “innocent until proven guilty.“
Additionally, the defense contends that these inquiries may not effectively uncover the jurors’ inherent biases, especially related to their encounters with cryptocurrencies. Moreover, specific questions could inadvertently guide the jury’s perspective instead of eliciting authentic insights, possibly compromising the trial’s impartiality.
With the jury selection scheduled to start on Oct. 3, closely followed by the trial, the spotlight is firmly on this high-stakes legal confrontation. This case underscores not only its immediate consequences but also underscores the vital importance of transparent communication and unbiased questioning in upholding the principles of justice.crypto crypto
Vitalik Buterin voices concerns over DAOs approving ETH staking pool operators
The Ethereum co-founder proposes a solution that could lower the likelihood of any individual liquid staking provider growing to a point where it poses…
The Ethereum co-founder proposes a solution that could lower the likelihood of any individual liquid staking provider growing to a point where it poses a systemic risk.
Vitalik Buterin, the co-founder of Ethereum, has expressed worries regarding decentralized autonomous organizations (DAOs) exerting a monopoly over the selection of node operators in liquidity staking pools.
In a September 30 blog post, Buterin issues a warning that as staking pools adopt the DAO approach for governance over node operators—who are ultimately responsible for the pool's funds—it can expose them to potential risks from malicious actors.
“With the DAO approach, if a single such staking token dominates, that leads to a single, potentially attackable governance gadget controlling a very large portion of all Ethereum validators.”
Buterin highlights the liquid staking provider Lido (LDO) as an example with a DAO that validates node operators. However, he emphasizes that relying on just one layer of protection may prove insufficient:
“To the credit of protocols like Lido, they have implemented safeguards against this, but one layer of defense may not be enough,” he noted.
Meanwhile, he explains that Rocket Pool offers the opportunity for anyone to become a node operator by placing an 8 Ether (ETH) deposit, which, at the time of this publication, is equivalent to approximately $13,406.
However, he notes this comes with its risks. "The Rocket Pool approach allows attackers to 51% attack the network, and force users to pay most of the costs," he stated.
On the other hand, Buterin highlights that having a mechanism to ascertain who can act as the underlying node operators is an inevitable necessity:
"It can't be unrestricted, because then attackers would join and amplify their attacks with users' funds."
Buterin further outlines that a possible approach to address this issue involves encouraging ecosystem participants to utilize a variety of liquid staking providers.
He clarifies this would decrease the likelihood of any one provider becoming excessively large and posing a systemic risk.
“In the longer term, however, this is an unstable equilibrium, and there is peril in relying too much on moralistic pressure to solve problems," he stated.ethereum
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