DAPPCON 2019: The Benefits of Finance-Oriented DAOs - Anastasia Andria (Akropolis)

Transcript

I'm gonna so I'll be quick when we're looking into the design of a protocol what Houston discoveries that wanted to show thee that I think are gonna be quite typical for for people experimenting with down's right now without governance simply because the community is looking for practical use cases and I really wanted to spend the following ten minutes on what we see as probably the most practical application off of dowse specifically and deeper that we see

right now there's good chart tracing out the devolution of community owned organizations of which now is one and that's what we can see is that from from tribal groups to Mutual's to cooperatives to took over to banks to me to banks to dowse is being community governed institutions have been really the the longest picture of human history what is released into observe is these

organizations in some shape one have existed for centuries but a lot of them are actually operating outside of the down framework as as by the mutual credit organizations or what photons live in around or at least last decade in Europe essentially but the way the function is these there's a member-owned organizations that enable distribution of shared benefits to the users in situations where the market doesn't provides

a solutions a particular problem right for instance if you look at a case of let's a mutual credit networks right so they've been established but probably the most prominent example is saw definitely we have all the three beers in Switzerland they are effectively dolls that provide a service but for one reason or another isn't provided by by the financial institutions could be access to credit it could be it could access to insurance or really basic

financial services like like savings account remittances or deposits and safekeeping those what we see therefore is an opportunity to actually leverage the current interest in dowse to not to reinvent the wheel but rather provide the framework to make existing member organizations a lot more efficient cheaper to run so super pragmatic approach but use of tech or reduce the capex it will reduce the time for working capital most importantly it will

enable them to scale specifically that means that one organization will be able to exchange value extend credit with another so what does that mean it means that should that network be established right it will default to act as a shadow banking network right if these members of the wonder core people call it's called mutual and I'll get to the details of how they're different but it's mostly semantics can contribute value so capitalize the Treasury or the

balance sheet of the coop of the down if they can co-invest with another down extend credit to another dow attract external credit that describes 95% of of the financial services that's supposed to be provided by the financial system right and it can be done in a way that's cheaper a lot more efficient and most importantly is not part of the legacy banking system so what does it mean it means that when there is a financial crisis what's called the contagion

effects so today but does anybody here remember what was happening you know 7 rates after the Lehman collapse right I was a clear about this one that thing happened and it wasn't even a red button but I was I was involved in restructuring moving all of the pushing of the bank up to its essentially what happened is whoever calico the collapse of investment bank in the US and regional economies in Europe but a muscle affected by the fallout right so the domain of package is called the collegian risk right so what does it mean is it when a one let's do one one down one core number an organization

he's financed by a bigger one right and there's a domino effect it will go down right it will be affected to the bankrupt or punch the crippled right if you combine that with fractional reserve banking you have very very quick and easy to spread contagion risks globally and this really is what happened you know seven or eight and this is it exactly will happen again because we're printed more money we have antiquus productivity we had more debt right so we sponsored by Arsenal for suppression having proven the same situation from happening where if you're a pensioner in Italy you lose your

pension because my American bank collapsed right so my parents live in the Baltic States for example and even I've seen horrendous personal impact on people just because let's say banks literally have been financed bum-bum-bum banks in Denmark for haven't passed down the quota to me easing put it C they received from ECB right question what does it have to do with the house why we're talking on this now so what is a bank a bank historically and all other attention back to the original slide is basically a bunch of people putting

money together into a common pot right that is group of people was split into those who contribute the capital and Kilgallen capital historically of an additional layer of complexity to account for action reserve lending and some support but it's super super basic level that's what it is right so if we have finance oriented Taoist martial ideological cool you know you can think of a more elegant name that's effectively I user owned and use a gallant multi sink would obviously with the custodial function that can be you can make it as robust or as focus on

self custody as you wish if you if you enable a mesh network and communication exchange your volume between those days what you have is basically share a financial sort of quasi banking network that doesn't depend on legacy banking system therefore is a resilient to contagion risks so therefore when there is the run on banks meaning you grates your bank you wanna take the money out of your accounts and surprise surprise you can't write this happened before it will happen again right this kind of network will by definition be but be very low on debt

mmm it'll be resilient to the risks inherent in in a current economy and the users differently from the current setup will actually be incentivized in growing the network simply because it you know as a mutual as a shareholder organization they actually get the the distribution of revenues right what's interesting is that this group's already exist they have some difficulties with scaling with with all banks so they

expensive to run or legacy for structures a muscle is suboptimal and this is where application approaching really makes a ton of sense right of course we are way off in terms of atomization on of assets but frankly on a two to three year horizon it looks really really what we're seeing readies with nothing Sonic's literally exchanging about six to live in the valley per annum what comes in Collins the purpose squarely are on social insurance subsection plates of insurance

for freelancers slate so so the clip is just on one goal but which is like you can't get insurance in this market because it worked herself and where more people are gonna be do the same thing how do you insure yourself it dance with you is it to a people that on regular basis puts its money in the trigger if you are sick something happens I better release the funds the funds released is proportional to the duration of your or they pay out something for occupying the funds in Ryland yeah so but the main challenge they have right

now as I mentioned is its scalability cost the cost of remittances or or cost of transactions and really up to now it's been challenging to envisage how can build that network right where we don't depend on the banking system anymore we don't depend on solar Gesell's of all banks or ECB's allowing us to take funds out of our accounts right where we no longer have to expect

a pension on social insurance that actually simply not there right so the expectation and a hope is with the development of defy cryptic aesthetic innovation on a fairly reasonable timeframe it should be possible to have highly efficient lean scalable user on financial organizations that effectively corpse right that are superior to what we have right now and can provide a real alternative to use this in the event of a financial crisis a lot of people in

the community talk about a gteen event as well and Sun support guys absolutely the same thing will happen in Europe right it's if you you know if you follow economist if you follow any let's say media hedge fund analyst you know or listen on five plus time you fuckless your time frame don't be very very very some way she's in Europe and in the US and in our view the only way to actually build a robust alternative is half exactly super lean mobile first essentially group

government are the for custody or custody party multi six of books that can exchange valley between each other right shins well the excellent credit provide insurance in a way that's very transparent scalable and gives you that freedom of not having to depend on a third party but inevitably never acts in your best interests on the proposition that you've put together have you at the ECB you mentioned if they've done any research on your protocol and and what I've been defining are they supportive so basically so what we're doing is not new what we went in the room you know

we're making the existing structures existing approaches cheaper efficient more scalable yeah so there is a new ECB as a friend east right as you know as any logical institution there is interest and support informal economy right and pull and we'll talk about here we'll start in the informal economy by definition right this has written Europe along is is estimated to be between three to five hundred billion euros right but that creatures factors outside of the banking system and by passing a partial

Institute's obviously looking they're keen to be able to capture it the risk support you do we can't alert of course not I mean ECB the solution that it was possible for is like that was a deflection scheme which means if there's a crisis security bank and you have your savings that don't be sure that the certain amount same problem exactly but if the bank goes down you you got it anything above being short minimum you're not going to be covered right and the same happens in there seven or eight and it absolutely will happen again if you look at the numbers some of the

research so I mean any central bank is interested in your solution with the Maxima class bad is there like active supports hold it up since their farm yes yes I guess that's the expected