Orca Protocol, a promising DAO stack
The Orca Protocol aims to provide DAO specific tools (aka DAO stack) to help them scale, organize and address on-chain governance issues without compromising decentralization.
The protocol aims to build governance around people based on their expertise (motivated actors) instead of their token holdings, allowing for a more modular approach.
An ideal governance model should maximize meaningful participation without sacrificing the organization’s efficiency. However, there are issues around scaling and token voting that are preventing DAOs from achieving this ideal model.
- Scaling: As the size of a DAO increases the cost of participation increases exponentially. High degree of participation becomes less sustainable and as a result of the few that participate; risk of centralized power increases. Also, the tools to write proposals and actively engage participation takes a lot of resources and would certainly be more difficult as the DAO grows which would lead to increased inefficiency.
- Token voting: While only representing the few, whales can influence voting as smaller holders have less impact on the outcome. Token voting can also be gamed as someone can purchase/borrow votes in exchange for paying interest to smaller players who are likely to lend for some economic interest. Therefore, token based on-chain governance is not sustainable.
Mini DAOs aka Pods that have their own multi-sig wallet controlled by pod members. A pod can co-exist with other pods, grow, shrink, split or merge like companies in the traditional world that seek to find best options for their vision and needs. Pod memberships are rule-based and are responsible for making decisions (votes happen on pod level) within their expertise that contributes to the larger DAO. Issues that token holders are not interested in should not require their attention: this allows for efficient participation regardless of the size of the DAO.
Pods (represented as an NFT) are multi-sig with rules to allow for flexible membership, align incentives, permissioning, checks and balances. They are also modular and lego-like for efficient structuring. Membership to one pod equals one vote and in order to incentivize long term thinking, conditional staking requirements can be created. Pod memberships are represented with ERC-1155 tokens which are non-fungible and can be made non-transferable. This is to limit bad extrinsic incentives (e.g. bribes) and strengthen intrinsic motivation. Ultimately, pods will offer an easy to use UI to create and approve proposals within a small working group. Orca Protocol is currently closed in beta and has plans for a public launch in the Summer/Fall.
A lot of DAOs are happening on discords today which lack efficient coordination/communication tools. As these communities grow the more fractionalized and diluted they become which is not sustainable. There is a spectrum of DAOs that are either decentralized and disorganized or centralized and organized. Orca protocol would serve the communities between these 2 extremes by helping to create a permissioned layer for accountability, checks and balances. A DAO stack that is flexible and modular would be extremely beneficial when compared to the tools available today without needing to mold to existing structures. For example, Syndicate is focused on regulator implications of DAO fund on chain but not full end to end solutions. Similarly, Coordinape is focused on just compensation and does not integrate other parts of governance. The ability for a community to spin up a DAO will also become much easier with the Pod mechanism. The future looks bright for them as they are also collaborating with existing DAOs (Yearn and Radical).
Check them out here → https://www.orcaprotocol.org/