As the Loot community builds and grows in cultural importance, various challenges will arise. Some of these have already been illustrated in the past week. $AGLD, a token given as an airdrop to all Loot holders, is up 1400% on the week. To this point there has been no proposal on the future utility of the token or if it should be a part of the community roadmap. While this may appeal to some (future projects should only adopt the token if they want to), it illustrates a real challenge for the community as those outside the project are now trading $AGLD and have viewed it as the de facto currency of the Loot Project. Without some level of community feedback, the risk becomes that speculators determine which things get built and with what.
At the same time, the singular virtue of Loot is permissionless building. This must always be cultivated. The goal of this essay is illustrate various potential approaches.
The Evo(Loot)ionary Approach
One path that can be forged is to follow no path. In this instance, builders continue to decide what gets built and the only formal community input is whether the community adopts the project. The community evolves as it adopts projects informally and best projects survive. This would maximize the freedom to build anything as it would be truly permissionless. It also allows for product-market fit to not be overfitted to some communal ideal of what Loot should become. The community finds itself as it builds.
Guilds serve as an intermediary step between the evolutionary approach and a more formal DAO structure. Guilds establish themselves as sub-communities within the project and can organize themselves as they best see fit. They can vote on guild matters, build for their sub-community, adopt a currency (or not) and continue to make decisions at the local level that best align with their interests. Regardless of any decision about an overarching DAO, these will continue to thrive. Some potential problems: will the Divine Robe Guild de facto serve as the driver of community decisions simply by virtue of economic power? One fear that the freedom maximalists have is that a DAO turns into a plutocracy. Is there already a risk of one being formed?
Any discussion of a DAO should be separated from discussion of AGLD initially. AGLD does not need to be adopted as the governance token and thus should not be assumed as the de facto token if a DAO was formed. Further, I will propose a DAO minimalist framework in addition to a DAO maximalist framework.
One approach that the community could take is to form a DAO that has tight guidance around the decisions it makes. The exact things a DAO should decide should be left for debate by others but suffice to say determining rewards for builders, economic alignment of the community, and other such decisions may be best decided by a formal governance structure. Importantly, this structure need not be linked to a token that has already been issued or even a token at all. One option may be to proportion votes to guilds. Another may be to allocate votes to builders, writers, and artists in accordance with community adoption of projects. One potential problem is that in deciding very little, the DAO decides nothing and is too ill-defined to make decisions around tokenomics, rewards, or grants.
The last approach would be for a DAO to be established with the power to determine the overall direction of the community. It would have final say on sanctioned loot projects, tokenomics, etc. The DAO would be equipped to make decision that come with the full sanction of the community. As with all DAOs, there is a risk of a decentralized organization having concentrated power amongst several holders and centralizing decision making.
Some Closing Thoughts:
While I have attempted to layout various options, I am sure this is not exhaustive. Further, I do not mean to suggest that the community must decide soon what lies ahead. Loot is an infant project. Its spontaneity is its greatest asset. However, it would be helpful to gauge community sentiment through a survey of sorts on various topics. First and foremost, we must deal with AGLD and determine how the community views it going forward. I propose that we set up a way by which we can collect data on how the community currently views itself and matters of collective interest.
Whatever path we go, I look forward to forging it with the adventurers. Onwards.