DECENTRALIZED AUTONOMOUS ORGANIZATION (DAO)

UTOPIA OR EQUITABLE DISTRIBUTION?

Abstract

Simultaneously with the fall of the Berlin wall, we witnessed the process of general acceptance
of the Internet as mainstream. Opportunities created in the last 30 years by the Internet, and
particularly in the last 10 years with the dramatic increase in the number of smart devices,
created new business model. Namely, internet giants such as Google, Facebook, Uber or Airbnb
have created on-line platforms through which they aggregate the potential resources of a large
number of individuals to provide services to even larger and a group of consumers. The previous
business model was based on centralized organizations, often with a dominant position in the
market in charge of providing services to a group of passive consumers. The new type of
“dematerialized” organizations doesn’t rely on ownership of property. However, the profit
generated by this new model is not fairly distributed - mediators who manage and own on-line
platforms retain the profits.
Recently new technology called blockchain emerged. The purpose of this new technology is to
facilitating the exchange in a reliable and decentralized way without intermediaries. Blockchain
technology allows substitution of hierarchical model of management with a computer system that
is decentralized and distributed among individual participants. This concept can changes the way
the profit is distributed, allowing people to work for creation of common good, whereby
everyone will be appropriately rewarded for their labour and engaged resources. But when
talking about new disruptive technologies we need to be careful due to the fact that at its creation
the internet was intended to narrow the gap between small entities and large corporations, yet
over time internet giants took control of the digital world.
The aim of this paper was to give an overview of the possibilities and challenges of blockchain
technology. The paper will make a theoretical analysis of the relevant papers in the subject area
and will present concluding observations regarding the dilemma whether this new technology is
utopia that is in advance condemned to failure or will succeed in the intention of fair distribution.
The conclusions suggest that organisation without hierarchy is utopian, but our finding shows
that DAO is possible with using blockchain technology, although it raises many questions
(liability, tax payments, jurisdiction etc.). But we need to be careful due to the fact that internet
giants took control of the digital world. Finally, social relationships are aspect that will be big
drawback for DAO.