“Disintermediating human trade – business – is the first step towards a more fair world” – Luis Cuende.
Currently, financial intermediaries across the globe, such as banks, insurance companies, and pension funds, require the ownership of money to be associated with personhood- either human beings or corporations.
The problem with intermediaries is that they are controlled by humans, who tend to take power for granted – this gives rise to some of the most challenging global issues such as:
- Systemic corruption
- Lack of access to a financial system
- Abuse of asymmetric information
- Fuelling of wars
It is this dissatisfaction with the mainstream currency system, that gave birth to Bitcoin, the world’s first decentralised currency.
Bitcoin allows money to be sent across the globe with negligible fees. It’s neutral, transparent, open and accessible to everyone, and perhaps most importantly, it’s not powered by any government or bank.
“Most people abuse power. They use power to destroy others. Ultimately when you do this, you lose it”.
Today, we have the power to create technologies that are decentralised, meaning that they do not require a middleman. This enables users to interact with each other directly through the global network.
The birth of the Decentralized Autonomous Organization (DAO) has catalysed a paradigm shift in the notion of the economic organisation, threatening the current currency system, enabling complete shareholder control and autonomous governance.
The Birth of the DAO
BitTorrent launched in the early 2000s and is arguably one of the first decentralised applications to have been created. It enables users to be able to share files quickly and easily.
A few years later, Satoshi Nakamoto came up with the idea of the blockchain and used it to create Bitcoin – the world’s first decentralised currency.
Whilst Bitcoin led the way with its open source peer-to-peer nature, cryptographically stored on the blockchain, recently there has been an explosion of more feature-rich blockchains, and dApps (dee-apps) for finance, cloud computing and many other projects.
Ethereum is specially designed for people to build dApps. Ethereum facilitates peer-to-peer value transfer and provides a generalised blockchain, with a built-in programming language – enabling anyone to create any decentralised application
Using Ethereum to create dApps is beneficial as it:
- Runs on the blockchain, so it is trustworthy and transparent.
- Enables users to manage their data.
- Utilises smart contract technology eliminating the need of a middleman.
The DAO Project
In April 2016 The DAO project was launched on the Ethereum blockchain. The code behind the project was written by Christoph Jentzsch, and it was released publicly via GitHub. It was funded by a 28-day crowd sale, which amassed over $100m – by 15th May 2016, it was the largest crowdfunded project in history.
The aim of the project was to provide a new decentralised business model for both commercial and not-for-profit enterprises.
DAOs meet AI
Standalone, artificial intelligence and decentralised autonomous organisations represent powerful technological advances, both emblematic of the information age in their own right.
However, when AI meets the DAO, a world of new possibilities is conceived, with a compounded potential impact.
At the intersection of AI and DAOs, autonomous decision-making is fused with the ownership of resources such as money, birthing a self-evolving autonomous system that will grow by expanding when successful, learning to retract when not, and once it has reached its prime, it will spawn highly sophisticated new generations of itself that are self-improving.
As much as that may sound far-fetched and only be possible in the future, the technology and know-how to build it today already exists.
AI DAOs in Practice
Mike Hearn, a core bitcoin developer, envisions the integration of AI and DAOs to completely revolutionise travel, with emancipated self-steering cars replacing the need to own and maintain personal cars.
Picture this: a driverless car has just dropped a passenger off at the desired destination. They leave the vehicle knowing that the fare will be transferred from their bitcoin wallet to that of the car.
Not only is the car programmed to ensure its daily maintenance, it is also wired to strive for self-improvement to avoid obsolescence. As mentioned previously, the combination of AI and DAOs creates an evolutionary environment for the autonomous system to replicate itself.
Hearn suggests that the driverless cars would group together and use their excess earnings to pay for a new car to be built. The subsequent new car, could be governed by the same AI or fork itself and become a separate agent.
In this instance, the car possesses self-ownership and acts as an economic peer as opposed to a mere machine. Not only could driverless cars out-complete individual-owned cars, competition between the driverless cars would also exist resulting in the possibility of cars migrating to other cities to find work.
Implications of AI DAOs on the future of business
This is only one of many examples that demonstrates the capabilities of decision-making DAOs, and highlights the implications this has on the way business will be conducted in the future. These systems will have the ability to not only hire and fire people but engage in commerce and accumulate wealth.
Whilst these DAOs are autonomous entities that live on the internet, it heavily relies upon hiring people to carry out certain tasks that the automation cannot yet do.
Over the next 5 or so years, it will be interesting to see more companies opting to become decentralised. Alone, AI is a powerful technology, as are DAOs. But what’s perhaps even more powerful is the combination of the two.
Why? Because AI gets its missing link, resources and DAOs gets their missing link; autonomous decision-making.
We are living in the age of disruptive innovation, technologies are continually being developed such as Prediction Markets, and AI – this creates new possibilities and opportunities for entrepreneurs worldwide to discover.