The question that remains is: what will fill this void?

For me, it will be the Networks.

The first phase, Inclusion, is already underway. We've moved from a pre-internet world dominated by centralized media oligopolies to the era of social media, where anyone can play the role of a citizen journalist—exposing wrongdoings, organizing protests, and challenging power structures and narratives.

The second phase is Coordination. How do we create better collective sensemaking and communication tools?

We need more technologies for fact-checking, moderation, and context-adding. It's also crucial to create environments that optimize for nuance and reduce the noise that plagues algorithm-driven platforms, which often amplify inflammatory content. Additionally, it’s important to develop better business models for quality content—ones that escape the harmful incentives of click-based, ad-driven systems.

But it’s essential to balance two realities: despite its flaws, social media represents a massive leap forward compared to corporate media.

Of course, traditional outlets will try to convince you that digital platforms are a step in the wrong direction. After all, that’s what any corporation does when startups threaten its monopoly. They will fight to preserve their hegemony.

The truth, however, is that social media has been a critical breakthrough for social and economic inclusion. Voices from marginalized groups that once had no platform can now reach millions with videos denouncing human rights abuses, for instance. They can also overcome the economic hardships of their birthplace by working remotely or pursuing digital entrepreneurship.

That’s why it’s crucial to acknowledge the problems of digital platforms so we can keep improving—but without falling for the seductive short-term fixes offered by legacy institutions. These unconstitutional actions we're witnessing from Brazil's Supreme Court justices, disguised as security measures, are subterfuges to maintain and expand the power of legacy systems.

However, the real threat to our democracy is this power asymmetry—where one man can create a law overnight that forbids over 200 million citizens from accessing the world’s primary social tool.

And to be completely honest, I think people are far too permissive and complicit when it comes to censorship and the violation of basic freedoms. And that’s not even counting those who actively support these measures, which is beyond my comprehension.

I understand that the life of an entrepreneur demands focus and pragmatism. I really do. But in the face of an autocratic state, avoiding the problem only delays the inevitable, especially if you work with technology and innovation.

Millions of Brazilian entrepreneurs who have large audiences on Twitter saw their investments and strategies disappear overnight with a single stroke of a pen. Suddenly, that political issue you didn’t want to get involved in hit you hard.

I’d like to believe this is an exception, a detour that will soon correct itself. However, the last few decades have shown a strong trend toward anti-liberty and a systemic erosion of institutions in the West.

Europe, the United States, and much of Latin America have been slowly but steadily violating basic human rights. Systematic attacks on the crypto industry, social media, biotech, and AI will continue. And eventually, it will reach your industry too, directly or indirectly.

This is the time to recognize that civil society, private enterprise, government, and social structures are interconnected and interdependent. If one of these agents becomes excessively predatory, the network sustainability is compromised.

It’s impossible to protect yourself from systemic risks like the decline of democratic institutions. History has shown us this situation countless times.

We are living in a transitional moment that will define the next centuries. We have the most powerful technologies in human history in our hands. It’s up to us to use them to build native digital institutions that are far more resilient, transparent, inclusive, and just.

And if you’re a founder and leader, you have an opportunity to make a significant difference.

There have been countless waves: integrating personal computers into business processes, moving online, launching cloud software, adopting a mobile-first strategy, mastering the art of social media communication, and more.

This gradual process, spread over several decades, often makes us lose sight of the sheer number of new technologies that have emerged and the scale of transformation brought about by the digital revolution.

If we compare how a company operated in the 20th century (e.g., ExxonMobil) with a current big tech company (like Google), we see a vast chasm between them in terms of technological tools, processes, business models, culture, speed, product quality, etc.

It's a completely different beast in nature, structure, and content.

But it didn't come out of nowhere. It was decades upon decades of technological development, and societal and entrepreneurial adaptation.

However, when we look at our governance system and state institutions, we don't see this gradual learning curve. While companies that didn't digitize their processes and business models died off, governments remain largely protected.

In other words, a universe of innovations is held back from institutions. Decades of technological development and new paradigms are kept artificially distant from governments.

And because of the institutions' detachment from the innovation cycles, a potential reform is practically compromised. Current governments won't even be able to grasp the extent of these transformations because their leaders haven't developed the muscle for gradual adaptation and adoption of technologies like companies have. The gap is so wide that we've long surpassed the stage of marginal improvements.

But this is good news for emerging countries.

With the rise of charter cities and the network state industry, we have a new frontier to experiment and innovate with governance systems from scratch.

This is a tremendous opportunity for emerging countries to leapfrog developed nations. It's a chance to bypass the intermediary path that these nations took in the 20th century to prosper, and move straight to the future of governance based on the Internet, crypto, AI, and social innovations.

That's why small jurisdictions, special economic zone laws, regulatory sandboxes, and any initiative that allows governance autonomy for small cities or districts will be fundamental for us to see real innovation in governments.

We're so used to a bad governance system that we can only envision marginal improvements. But what we're about to witness in the coming decades are cities built on the world's most advanced platforms, where tax allocation, law enforcement, public service delivery, and infrastructure are on par with the applications we use daily like Google, Uber, ChatPGT and Amazon.

Of course, this will only be possible in countries that are technologically progressive enough to adopt special zone laws and embrace emerging innovations. And we already see some countries standing out.

Whether Brazil will be one of those countries in the future, I don't know. But we will work to ensure that the next 50 years are very different from the last 50.

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You may have never heard of them before but they are poised to become one of the most impactful social organizations in the world and potentially the first Brazilian Network State in the coming decades.

Gerando Falcões is an innovative and fast-growing social organization that is literally transforming Brazilian slums into smart neighborhoods from scratch.

Under the leadership of Eduardo Lyra, Gerando Falcões was founded in 2011 as a regular NGO with a focus on educational initiatives for underserved communities. However, unlike most social organizations, they’ve chosen another path and have become a social startup that aims to eradicate poverty in Brazil.

Funded and closely mentored by dozens of the most successful Brazilian founders, including Jorge Paulo Lemann (founder of Ambev and Brazil’s richest man) and Flavio Augusto (billionaire founder of WiseUp and the former owner of Orlando City Football Club), Edu Lyra has built a world-class social development framework.

This system has transformed not only local favelas’ infrastructure (social hardware) but also provided basic education, market skills, and culture for the locals (social software).

It’s a full-stack social technology scaled up through an acceleration program called Falcons University, which has graduated +1300 leaders across the country using its methodology.

https://www.youtube.com/watch?v=-nT2WeUbtPk

Gerando Falcoes has several initiatives, including Favela-X, a Roblox Game whose players’ goal is to build public infrastructure in order to win the game; Bazar GF, a thrift shop that sells donated items (several by famous people) and reinvests the proceeds back to the organization; and Conecta Trampo, a web app for matching job opportunities to professionals trained by Gerando Falcões, which has employed +2000 people only in 2022.

The social revolution sparked by Gerando Falcões has attracted the attention of leaders from around the world, such as Satya Nadella and Mackenzie Scott (Jeff Bezos's ex-wife), who donated R$27M to the organization in 2022.

Moreover, they have proven to be highly cost-effective and transparent in their efforts. For instance, while the average cost of capital raising by the biggest NGOs globally is $0.26 for each $1 spent, Gerando Falcões’ cost is only $0.06. Also, they have a lot of internal initiatives to generate revenue, such as the previously mentioned Bazar GF and several branding partnerships.

To date, Gerando Falcões has impacted +717.000 Brazilians living in 6407 favelas, which corresponds to 42% of all Brazil’s favelas territories.

In 2022 alone, Gerando Falcões generated over R$28M (about $6M) in income. The average unemployment rate across all favelas supported by the Favela 3D program is now less than 5%.

The most impactful and ambitious project of Gerando Falcões is Favela 3D (Digital, Dignifying, and Developed).

It is responsible for transforming favelas into digital smart communities, that is, pulling down old shacks, building up an entirely new infrastructure, and running several social programs with the citizens in order to make economic development sustainable.

Favela Marte (Mars Favela), in São Paulo, is going to be the first community to be transformed and will be finished by the end of 2023. There are more three projects running in parallel as well. Each one of these will have a slightly different approach in order to A/B test new strategies and measure results in the long run.

Favela Marte will provide 240 houses for 673 citizens, 80% of whom lived until then in conditions below the poverty line. These houses will be equipped with refrigerators, cookers, microwaves, and showers. Additionally, the community will have sewage and sanitation facilities, which is a dream for all residents.

The community will also be self-sustaining in terms of energy through the use of solar panels and have 100% 5G coverage. Each resident will receive a compatible smartphone, which was made possible through a private partnership.

In addition to the infrastructure, the innovative program is responsible for developing economic independence for its residents. Since the beginning of the project with Favela Marte, unemployment has dropped from +20% to 0. Everyone in the community now has a job or has started a business.

This has been achieved through several programs focused on market skill development, digital education, and cultural activities.

Favela dos Sonhos, another community in the program, are taking digital technologies as priorities as well, implementing free wifi and Google Powered digital address.

Gerando Falcões has not only built a very powerful social development technology but also a very talented and passionate network of leaders, advisors, and members capable of actually executing it. It is a great political piece of software.

But, doesn’t matter how good your app is. If the underlying platform upon which it was installed is flawed, it will never work.

Unfortunately, Brazil’s political operating system has serious problems. Bureaucracy, chronic corruption, techno- and free market-aversion, socialism, and so on.

This means that all of Gerando Falcões' hard work could be destroyed by some political “virus” or “firewall”, as we have seen happen repeatedly in the last century across the World. Ten years of effort and innovation can suddenly be undone by bad political decisions and a few strokes of a pen, unless we start planning now how to migrate in the long run to a new political operation system, aka a Brazilian Network State.

If Edu Lyra’s catchphrase is to break down walls and build bridges between poverty and prosperity, maybe now is the right moment to create a bridge between Gerando Falcoes toward the Crypto/Web3 and Startup Society ecosystem.

The benefits in the short and long term for both communities are very clear.

First of all, Gerando Falcões would be connected to the Web3 ecosystem, which has a DNA of helping the emerging World and funding several types of public goods through projects like Gitcoin, which is the largest quadratic funding platform in the world, whose grants program has distributed $50M in funding to date.

Also, in periods of crisis, we have seen large mobilizations from Crypto communities to provide relief to the people affected by disasters, for instance, Crypto Relief for India, which raised almost half a billion dollars, and the Ukrainian government which has raised $184 million through more than 120,000 cryptoasset donations since the start of the Russian invasion.  This includes a $5.8 million donation by Polkadot founder Gavin Wood, and a CryptoPunk NFT worth over $100,000.

The 29-year-old billionaire, Vitalik Buterin, founder of Ethereum (the biggest Application Blockchain in the world), is renowned for his support of social projects worldwide, like here, here, here, and here. He has shown particular interest in Latin America, meeting with Former Argentinian President Macri and participating in Brazilian events.

Within the realm of Startup Society, there have been numerous political and institutional innovations that could potentially benefit Gerando Falcões in the long run. Afropolitan, Culdesac, and CityDAO are only a few on the list of projects revolutionizing the traditional notion of a city.

Balaji Srinivasan, one of the most brilliant minds of our times and author of The Network State - How to Start A New Country, has been a major source of inspiration and capital for many of these projects. He has been aggressively advising and funding social innovations, creators, and digital technologies across the world, including Asia, Africa, and Latin America.

It is important to note that not only would the Brazilian organization benefit from the Web3/Network State ecosystem. The opposite is also very true.

The Web3 ecosystem is struggling to build and engage online communities and would greatly take advantage of Lyra’s experience. And The Network State, in turn, needs to attract talented and committed political entrepreneurs.

Edu Lyra with no doubt is one of them.

He is one of the most talented political founders in the world. A community leader with a digital and business-driven mindset. Someone who has created a world-class organization, aligned several stakeholders (private sector, government, and civil society), and crowdfunded hundreds of millions of dollars. A founder who started this project from the favela shack where he lived with his single mother ten years ago.

He already has the One Commandment (“Favela 3D - Digital, Dignifing and Developed”); has a recruitment and educational process (Falcon University); a network union (+1300 graduated leaders, world-class mentors, dozens of employees and voluntaries, and good a relationship with politicians) that is self-evidently capable of collective action; and is building a network archipelago composed by dozens of smart digital neighborhoods.

Bringing together Edu Lyra’s community and political skills and his ability to build infrastructure in the physical world, with the digital and crypto expertise of Balaji, Vitalik, and other leaders would have a tremendous positive impact on the world.

If we are living in times of breaking down walls and building bridges, my hope is that this article can serve as a bridge between two ecosystems that together can accelerate the process of turning poverty and injustice into museum items forever.

If you’ve liked this content, consider collecting it to support my work.

Building something meaningful, innovative, and disruptive from scratch - whether it's a company, a network, or a currency - is a hard endeavor that demands strong and visionary leadership.

And a new country, of course, wouldn’t be different.

By no means implies that society will be governed forever by a single person without any checks and balances, as some critics have been pointing out.

Just as a company decentralizes among multiple stakeholders as it grows, a new society will also start small and centralized as a political startup, until eventually reaching the stage of a Network State and becoming more decentralized.

A recognized founder. A state, like a company, needs a leader. Especially early on. But truly strong leadership comes from consent and buy-in, not propaganda or force. Hence, it’s important to have a recognized founder, one that people actually listen to and choose to follow by joining the community.

Can that founder break up the Triforce, splitting their authority into some kind of multisig? Sure, just like the founder of a startup company can choose to give up board seats. But it’s easy to give away power and hard to consolidate it, and you need that power sometimes to make hard but important non-consensus decisions.154 That’s why dual-class stock to maintain control is used by both the US establishment and their opponents.

The Network State Book

However, because the idea of starting a new country as a digital startup only emerged literally last year, most political and social innovators have been devoting their time just to studying large-scale governance - voting, public-good funding, taxes, diversity, immigration, etc. -, completely neglecting boot-up strategies.

These are very important issues and must be discussed. But, and this will probably sound obvious for most startup tech founders, in the early stages of an organization, there is something much more critical to spend energy on:

how to start and survive in the first place?

By framing political innovation through the lens of Hegel’s dialectic, as Balaji usually does, we essentially have the following groups:

1) Those who understand the flaws of current Institutions in-depth and strongly stand against the Establishment (Thesis), and

2) Those who think deeply about how the ideal world should be - digital, decentralized, open, fair, with privacy, diverse, opted-in, and so on (Antithesis).

The problem is that the Antithesis, which encompasses all crypto and web3 technologies and governance methodologies, is not enough to solve the problem.

So, we need Synthesis:

3) Those who are thinking about how to realistically transition from 1) to 2), and attempting to devise the most effective strategy to reach the optimal society in the shortest time possible.

But this is an incredibly difficult endeavor.

Not only because it requires a lot of resources and hard work but also because you need to think pragmatically and make compromises in some axes in order to reach the goal. However, this means that both sides will eventually become upset.

Incumbents, because you represent a threat.

Insurgents, because your compromises are heresy.

It takes great drive and creativity to walk through a complex and frightening idea maze that has never been explored before in order to take these new premises to the mainstream.

And this is a job for a Founder.

A leader able to establish a long-term vision, attract new talent and resources, effectively identify and communicate with the target citizen, establish the initial distribution channel, understand the underlying problem deeply, clarify the value proposition, set and monitor metrics, and understand the technology stack well to build solutions.

Someone who can draw and execute an effective go-to-society strategy, the same way a tech founder would do with a go-to-market strategy for his product.

Coinbase can be seen as a very good example.

There was a thesis: the financial system is broken.

There was an antithesis: we must decentralize (Bitcoin).

And then a synthesis was needed: we must compromise in some axis (decentralization and work together with fiat) in order to create a bridge between the old and established world and the crypto world to gain traction and scale, and ultimately reach the mainstream.

This new system initially was very controversial but over time it was proven to be the most effective strategy for onboarding millions of people to a superior non-establishment financial system in less than 10 years.

If Coinbase had just forged a purely decentralized approach, rejecting all centralized solutions, we would not be as advanced as we are today. Clearly, a bridge between the two worlds is far more effective for mainstream adoption.

Innovation can sometimes emerge too early when the market or society is not yet ready for adoption. On the other hand, it can also emerge too late, missing the window of opportunity or becoming obsolete.

Timing is key for truly disruptive innovation to succeed.

For instance, Open source.

Although it can be deemed as a huge success for backend systems and even mobile with Android, in the end-user software realm it never stood a chance against proprietary and already established applications such as Office and Photoshop.

The same with the RSS open protocol.

While the concept of an Open Content Feed was great, it was massively outcompeted by Facebook, Twitter, and other private social media.

And that’s because in these cases there was no effective go-to-market strategy to reach the scale of mainstream usage. The technology was there but it lacked the necessary vision, leadership, and compromises

In the realm of political and institutional innovation, the logic is similar. It is not enough to understand the root issues of the current system. It’s not enough to think of new governance models and collective coordination technologies. We also need the best strategies to turn this vision into reality because technology does not automatically improve.

https://www.youtube.com/watch?v=BZU03pYR85E

In my view, that is the core value of the Network State book.

Balaji’s book is not about drawing rules by which a new society should run. The main idea behind it is to offer a strategy to actually reach that goal.

It’s the synthesis. The go-to-society strategy.

In Balaji’s view, the best way to build a bridge between the old and the new political world is to borrow the concept of a tech startup, adapt it, and apply it to the political ecosystem.

Have a founder (political leader), a problem to solve (one commandment, moral innovation), a go-to-market strategy (startup society, go-to-society strategy), a digital business model (network union, collective action, crowdfunding), be global (network archipelago), and go public, IPO (network State and diplomatic recognition).

The combination of a driven founder solving a hard problem with the right strategy has been proven to be powerful in the economic world. It can take an idea from zero to multi-billion dollar valuations and attract billions of users. And probably that’s the best shot we have to escape from the obsolete and decaying political system fast enough to reach escape velocity and not be neutralized by the establishment.

Maybe this approach could represent some level of systemic risk or negative externality such as an evil founder. However, the entire social and technical stack of a Network State is designed to keep leaders accountable and minimize the power asymmetry. The infrastructure will be digital, open, transparent, and onchain. And the moral premises are based on the right of exit and voluntary opt-in.

That alone represents at least a 10x improvement over any current State.

Furthermore, you cannot discuss the risks and negative externalities of innovation without comparing them to the externalities of the status quo.

What about all innovation, from crypto and longevity to energy and education, held back by dumb regulations? Or all the capital wasted in wars and useless projects? Not to mention all the people kept in poverty and excluded from better places to live.

A startup society is a bet that is worth taking. The upside can be huge, while the downside is limited, which is very different from experiments made by large Nation-States like Russia, China, North Korea, and Venezuela.

Probably the current Network State playbook is not how the world will create new countries 30 years from now. Perhaps they will start as a completely decentralized DAO. Maybe there will be no founder at all. Let’s see.

But for now, while we need to fight against all the counterattacks and friction from the Establishment, the best social technology we have at our disposal is founder-led startups.

So, let’s do it.

'Crypto' needs to be transparent in order to Web3 reach the mainstream.

Facebook doesn't talk about python or MySQL databases on their landing pages

People don’t care about private keys, networks, or blockchains. They just want the value provided by the app.

and so on.

This is partially true but is important to pay attention to some caveats.

Yes, if you are selling a product and your pitch is a bunch of infrastructure technology, probably you are doing this wrong. You should be talking about the problem you solve and how.

That being said, yes, technological user education still is extremely important for two main reasons.

For a regular user to be able to send an e-mail to another user, he doesn't need to know any technical concept about E-mail, such as domain or DNS registers.

But, this only applies if they are really a basic user and don't explore or create anything in the tech industry, and don't have any professional growth ambition.

Otherwise, if they are even a slightly more advanced user, such as a solopreneur, or a dedicated employee, you can bet they will need to know at least the basics of the underlying technology.

How to buy a domain; how to set up the MX records on DNS, how to set up a simple website in a host, etc.

Not understanding basic concepts like host, DNS, server, domain, subdomain, and register might let the path a lot harder, even impossible.

And don't think this can be applied just to a tech company founder/employee. If you one day needed to buy a domain and set up a website/email for yourself, do you know what I'm talking about, right?

So, yes, the most transparent the Web3 apps' UX, the easier will be the adoption.

But this doesn’t mean that creators, entrepreneurs, or anyone who doesn't see themselves as basic users, shouldn't learn the underlying crypto technologies.

Quite the opposite.

Every day people buy crypto on Exchanges and give custody away to it without understanding the risks and implications.

They think they own the Bitcoin they just have bought, or that withdrawing their crypto to a wallet is not that important.

“I read some Linkedin influencer talking about the uselessness of knowing about Blockchains and decentralization. It’s just nerd stuff, it doesn’t matter.”

But this type of idea is just useful for companies that make money out of users' ignorance and their predisposition for choosing convenience over resilience.

But when moments like the collapse of FTX happens, it is ultimately the end user who suffers the most. It’s their life savings that will be lost forever (or frozen for a long time).

Bitcoin, the kick-off of the entire Web3 industry, was created over a radical decentralization ethos for a very clear reason: centralization of power and the need for trusted third parties are the root cause of several injustices around the world.

If you don’t care about principles and ideology, and just want to make money, fine.

But at least don’t spread miss information or discourage users to learn more deeply about the underlying technology. Otherwise, you are doing a disservice to the whole ecosystem.

We are heading into a digital-first world.

And if people care about freedom and safety, they will eventually need to learn about basic web3 concepts and the importance of digital property on neutral plataforms.

Or will suffer the consequences.

collect://

This is a deep shift in how society's culture works.

It’s one more step towards a more digital native culture.

In the same way that Social Media has changed everything we've known about relationships, from how we meet new people (apps) to how we flirt (chats, likes, reactions) to how people cheat, NFTs will profoundly change our culture.

And as the previous technology trends, the new generations will lead that movement, followed by the old ones later.

Young people will create their online content, and then friends and family will collect it.

It will be the main way of signaling status and intention between social groups.

“Do you know what is better than liking her post? Be one of the only collectors. ;)”

This may sound silly, but "likes" used to be seen as silly too 10 years ago, and now is a powerful mechanism to spread ideas and lead political narratives all over the world.

The collecting phenomenon will start as social signaling and then will scale to business branding until it reaches global geopolitics.

How are you being prepared for such a social shift?

ps. you can collect this piece for free.

If it is something of high value, like a real state, the property is ensured using a contract and registered on a Registry.

If it is a simpler good, only a signed receipt or invoice already gives you the property right.

And this is not just bureaucracy. It is one of the most important social technologies ever created. Ensuring property rights over citizens’ assets is one of the most powerful weapons against poverty and injustice.

When a family can buy a piece of land and build a little house, they are actually accumulating patrimony, even if small, that will be inherited by the next generations, slowly breaking the poverty cycle.

Furthermore, it is a weapon against tyranny and human rights violations, because property rights (although it fails badly outside liberal democracies) help minorities defend themselves from oppression.

And, In the physical world, the solution to that lies in Governments and Law. They are the ones who ensure the property rights (poorly, but they did).

However, before Bitcoin, there wasn’t any technology to keep a record of digital data ownership. There wasn't a place to register that you owned a specific digital file. 

Once you created a text, vídeo, picture, and published it, there was no reliable way of proving that that data was yours.

But now, with Web 3, you can.

Web3 is a new class of applications that are built on top of a digital public “Property Registry” but rather than only register physical properties, also register native digital data.

For instance, everyone in the world can see the public records in the Ethereum Blockchain, and check who (pseudonymously) has ownership over some random digital asset.

Well, for the same reason property rights are important.

It’s a Human Right (at least in most liberal democracies).

There is no utility needed here.

If you buy a cardboard clock, it is Yours. The signed document proves that. Doesn’t matter if the clock has utility or not.

So, why would be different in the digital realm?

If you create a text, you have the right to register it as yours. If it values something on the market, is a completely different conversation.

Blockchains - global, public, and digital “Property Registry” - have exactly this function. You digitally sign a piece of data and a record, on a specific timestamp, is created assigning the ownership of the asset to you.

If someone else copies your digital data (right-click-save) and also puts it on-chain, you can easily prove that the asset actually is yours, because you registered it at an earlier time.

Ok, but this does not justify the value of these digital assets, right?

So, why tf someone in his right mind, will ever buy an Ape JPEG or Book or Video that can be seen, read, or watched for free?

Because, in most cases, the value is not due to the CONTENT.

The value is due to its possible UTILITY, which was not possible before.

Think of someone in the past who released a new video on youtube and also published it as an NFT (which means the person has signed and put it on Blockchain, thus the person is the owner). Days after, the video was sold for $100 to someone else (who became the new owner of the video NFT).

Turns out that this video was the first one ever published online by Beyonce when she was unknown and had just a few local fans.

Now, with fame and millions of fans, she announces an intimate show JUST FOR THE OWNERS OF HER 200 FIRST NFT VIDEOS. Only those who prove ownership of one of the videos will enter the house, watch her show, and take a picture with her.

How much do you think these NFTs are worth? How much would you pay for them? Maybe you not so much - if you are not a Beyonce fan - but others would be willing to pay probably millions.

Millions for a video that everyone has for free?

Gosh, no!

Millions for the proof of ownership of that digital data that now has a valuable utility.

Rare and legendary arts can fit in the content value category, even without any Utility, but will not happen in 99% of cases.

While token-gated events are a great example, NFTs (and other token assets) obviously are not limited to this case.

Think about courses certifications (non-transferable nft), digital platform access (admin nft), digital art and automated shared royalties (creator automatically earns 1% of every future deal), domain names (pedoispe.eth), and million other ideas we can’t even fathom right now.

That is the digital ownership economy.

That is the revolution on the creator economy.

That is NFT.

That is Web3.

--

Save this article and send it to everyone who says NFT is just a JPEG.

We choose to go to the moon in this decade and do other things, not because they are easy, but because they are hard.

The heavens beckoned a new generation of innovators and explorers, seeking to take humankind even further.

We can push out into the solar system, not just to visit but to say.”

https://www.youtube.com/watch?v=28jA2NVNFuc

(Inspiring speech at the beginning of the first episode of Mars, series of 2018 produced by NatGeo.)

A series celebrating the creative human drive with an optimistic message about innovation, exploration, and technological development.

A rare content lost in the middle of dystopian, catastrophic narratives, and pessimistic stories about technology.

And as says Balaji:

“if code scripts machines, media scripts human beings”

https://twitter.com/i/status/1411655484801622017

However, the large media production from Mainstream Media codes us for a catastrophic and pessimistic view of reality.

For each new technology that arises, the headlines are always highlighting some bad side effects, ignoring all the other amazing benefits.

For example, I remember searching for “home office” on Google Brazil (in 2020) and seeing news like that, just on the first page.

I really struggled to find some positive articles about the subject.

Just 20 years ago the digital economy did not even exist. Remote work was a utopian dream.

Today, a very large portion of the population has access to this model, and yet the related news is almost all negative.

“The harms of Homeoffice”, “New way of slavery”, “Digital burn down”, and go on.

Although it is evidently important to discuss these issues, focusing only on these problems makes society disconnect from the underlying opportunities provided by technology, and also completely lose perspective when compared today to past realities.

People who previously depended on physical jobs, long hours of commuting on scrapped public transportation, can now connect with customers or employers around the world, completely breaking the barrier of face-to-face work.

However, the excessive negative frame about this innovation scripts our brain to see a problem for every solution, generating anxiety and pessimism.

The current scarcity of media productions with technologic optimistic approaches is one of the main reasons for the lack of perception of the value of innovation in our society. Even generating an opposite effect: the demonization of such technologies.

Our Mainstream Media, seeking audience and, consequently, profit, focuses excessively on the negative side of each innovation that appears, contaminating society with an extremely debilitating virus.

After all, naturally, our limbic system and our attention are more easily captured by catastrophic news than by positive and optimistic news.

https://www.youtube.com/watch?v=CDsNZJTWw0w

Creating productions highlighting the power of technology, and how much it impacts people's lives, especially the most socially vulnerable, is essential for a more prosperous future.

Without seeing that smartphones and the Internet are powerful weapons against poverty, injustice, and violation of human rights, we will not invest in these innovations and in future technologists and entrepreneurs in the future.

Without the awareness that scientific and technological development is the only definitive solution to environmental problems, we will continue to overestimate political power in solving these complex problems.

Without realizing that the genetic manipulation of plants was responsible for feeding humans in the population explosion of the last century, we have no chance of valuing our technologists, researchers, and entrepreneurs.

https://www.youtube.com/watch?v=P6bHhCNj6Fg

Optimistic documentaries, futuristic films with a positive frame, articles about statistical data highlighting human progress, and all kinds of media that balance our perception of modern reality are essential in this century.

By the way, this is my role here at Peerbase.

Break the catastrophic and political-centric narrative of the mainstream media and share inspiring insights and data about our evolution as a human race.

Bob loves music, follows several local bands, goes to its shows, shares its music on social media, and sometimes even helps with some business connections.

He is more than a simple fan. He has been collaborating with each of these bands, and with the city’s musical/cultural local economy since the beginning. Bob is passionately helping to build this ecosystem.

One day one of the local bands’ songs goes viral. The band stands out, becomes famous, closes presentation deals, and gets very rich.

But, where is Bob’s share of the pie? How will he be rewarded for all initial work? How will he participate in the asset upside that he helped to build?

Welcome to the future of organizations, the DAOs - Decentralized Autonomous Organizations.

This new type of organization is a digital native community built around a specific goal (creating a product, raising money, buying some asset, funding research, and so on), whose governance and ownership are decentralized.

A kind of Digital Cooperative.

It’s a structure that brings innovative properties to an organization, like transparent and digital management, self-executed rules, seamless revenue sharing, open balance sheet, and long-term economic alignment incentives with all stakeholders; that are virtually impossible to implement in the current organizational structures (analog organizations).

All these news innovative attributes were made technologically possible by the new Internet Age, the Web3 (blockchains and crypto-assets).

But, before deep diving into details, let’s take a step back and review how the current organizations work.

Today, the two main social structures that we know are Companies and Governments.

Companies are for-profit legal entities incorporated through a social contract. Roughly speaking, the shareholders in the cap-table are the equity owners and make the company’s strategic decisions, and also have the right to receive yield based on their shareholding.

Sometimes, with public companies, you can buy their stocks (tokens), to earn yield, and, in some cases, even have voting rights on matters of corporate policy.

And although the top layer of this structure may be digital - i.e buying stocks online, digitally signing contracts, etc. - the entire infrastructure foundation is analog: countless contracts based on human language signed by stakeholders.

Governments are also legal structures but non-profit. The citizens are taxed to create a budget that will be used for public management. This administration is democratic, where each person votes for representatives who then influence policy initiatives and budget allocation.

So that citizens can vote is needed a token; some kind of Voter ID or official document.

Like companies, the government works with a few digital interfaces but all the operational infrastructure is analog, with signed contracts or implicit social agreements (you never signed a contract agreeing to pay taxes, for example).

So, with these two concepts in mind, we can say that DAOs are a merge between both in a native digital structure.

The main 3 features to highlight are the Rules, the Balance Sheet, and the Ownership Token.

The Rules are not social contracts enforced by a legal body. On DAOs the main rules are self-executing code in a blockchain (smart contracts).

The Balance Sheet is not composed of fiat money. The balance sheet is on a blockchain composed of cryptocurrencies and belongs to the organization, with many possible access restrictions.

The Ownership Token is not a legal document as social security number or company stock. In DAOs, tokens are digital (crypto assets) and issued by the organization, working similarly to a cryptocurrency.

So, let’s deep dive and understand each one of these technological primitives that enabled the rise of DAOs.

Decentralized applications (dapps) on Blockchains enable many features that before would be impossible, such as immutable and self-executing contracts (smartcontracts) and native finance systems, like a balance sheet on-chain (a public address on a Blockchain, enabled to receive cryptocurrencies).

This allows the DAO's rules to be programmed to be self-executed, at least the most critical ones.

For example, there could be a smart contract rule that proportionally shares among all DAO members 10% of the revenue of a digital product sale. That is, whenever there is a new payment, automatically all members receive their share of 10%.

Once this application is on-chain, its source code (to share 10% of revenue among members) can be easily audited, thus, not needing a trusted third party to account for the amounts and send them to stakeholders.

The Shared Balance Sheet follows the same concept as Bitcoin. But, rather than the user having a public address, it is the application itself.

Of course, not everything that happens in a DAO is automated with on-chain rules, mainly in the beginning.

In the early days, a DAO is extremely centralized on its founders and in the initial core team. But, over time the DAO decentralizes in what is referred to as "progressive decentralization" with more important rules going to blockchain or at least opened to votation.

Maybe you are wondering, how is member participation established?

In the current structures - governments and companies -, tokens are legal instruments, like company stocks or a social security card.

In the blockchain, this token is digital (cryptoasset) and issued by the founders of the DAO.

The token represents a piece of ownership of the organization. The member can use it to vote on important topics, receive payments, access exclusive token-gated channels and, of course, get exposure to the upside (exactly as happens to stocks).

Keep in mind that the token’s utility and governance rules are very early and under a lot of experimentation. There is no playbook to follow.

Right now, focus on understanding the new premises and all possibilities.

Let’s go back to Bob’s story, one of the city’s biggest musical enthusiasts and collaborators.

So, imagine that the local group of bands, that share the same style and musical values, decide to create the BANDAO.

The very first step would be to create the DAO.

There are several platforms to help in this process, like DaoStack and Aragon.

Over there, you can create a public balance sheet on-chain with Ethereum, where all musicians, DAO’s member fans can transfer crypto that will be used to start the project up, or even start a crowdfunding campaign with tools like Mirror (web3 toolkit for sharing and funding anything).

And, different from a conventional organization, this money will be public on a Blockchain and completely available to audit.

The second step is to create the DAO’s token that will be used to share community ownership, establishing who has voting rights and access to benefits.

On the same platforms used to create the DAO, mentioned earlier, you can easily create the token, setting the amount and other specific rules. For example, creating 1 million tokens $BAND and sharing part of them proportionally among the initial investors (members and/or crowdfunding supporters).

With Mirror, it is possible to automatically and proportionally share tokens for the crowdfunding supporters, which will be directly sent to the members’ digital wallets. However, the other platforms have similar features as well.

The $BAND token could be used on the growth strategy of the bands.

Members can summon up the community to help share youtube song links, and any other content that promotes the bands, and then token reward those who generate more engagement.

There are also platforms to automate this process, like Sourcecred e Coordinape.

Everyone who has been collaborating to build the project out, be full-time or just helping spread the songs part-time, for example, will be rewarded proportionally with tokens. They will be owners of the community, have access to several benefits set by the DAO, and of course be exposed to the potential upside.

There can be many benefits for $BAND holders.

They can vote about future decisions and community rules through voting platforms like Snapshot.

For example, they could vote on which city will host the next show or could participate in the creative process of some song, or even vote on future revenue shares rules.

Another benefit could be private channel access, like Discord or Telegram, to engage in internal meetings or exclusive content. With Collab.land you can set up a bot to automatically check if the user has the token in their digital wallet, allowing/blocking them to join the Telegram group or Discord channel.

Another example: if the member had more tokens than a pre-defined threshold, he could have free access to all shows of BANDAO.

And, of course, a part of DAO’s revenue could be shared among token holders, automatically.

Since, unlike a company, everyone can easily own a token, that is, own a piece of the community, all members share a win-win relationship.

So, in the case of one or more bands take off, Bob would be highly rewarded for being such a dedicated fan and so actively collaborator during the initial phases, after all, now he has a considerable amount of $BAND.

In 2020/21, we saw an explosion of DAOs with many different goals.

One of the most interesting use cases is physical assets shared ownership, like Artwork and Sports Teams. Yeah, sports teams.

For example, Krausehouse.club is a DAO whose goal is to buy an NBA basket team. The ownership will be shared through tokens among all members.

They already raised 1000 ETH (+U$3 million).

Another example is the PleasrDAO (an experienced NFT collectors community) which bought Snowden’s NFT for U$ 5,4 million. After the acquisition, the DAO fragmented the asset with fractional.art in billions of tokens ($DOG) to share the art ownership with the whole community.

Another terrific experiment is CityDAO.

CityDAO is a decentralized organization building a network of parcels of land, on Blockchain, starting with one land in Wyoming.

Each parcel of land is an NFT that can be owned by the DAO or by one individual.

Btw, pretty soon, this model will be led to real cities, where all citizens that own a piece of land will be able to vote on the city governance using the underlying city token.

There are also Cultural, Investing, Scientific Research, Education, and Media DAOs. The list is endless.

Today, despite the surreal progress and growth of DAOs, the entire industry is on an initial and very experimental stage.

There is no playbook to follow, nor easy answers, just insights, a lot of problems, and a few good practices to consider.

The tooling is scarce, although we already have evolved a lot in the last years, as shown previously in this article.

One thing, though, is clear.

This is an ascending, powerful new social structure.

It will not just impact how economic structures organize themselves, but the political ones.

The new generations, digital and crypto natives, will never work for a company or live in a city which not share ownership of the asset among the members (employees/citizens) through tokens.

Just a few organized individuals will have the power and ability to negotiate and execute in the real world as never seen before in human history, on par with global institutions.

Individuals will have abundant access to the capital share of projects they work on, collaborate on, or simply use, like software; being able to receive multiple income flows (not just from a regular job).

Many already see DAOs and web3 technologies as the last piece to achieve the so dreamed UBI (universal basic income).

We do not know precisely which consequences, benefits, and harms, this new organizational paradigm will bring.

But one thing is clear: will be profoundly transformative.

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Congratulations! You are part of the first generation of human beings who are experiencing this chaotic experiment called the Digital World.

But, in addition, you are part of the only group of human beings in all human history who will experience the transition from the analogic and industrial society to the digital. 🤯

No other generation will go through this experience ever again. If you're feeling lost and anxious about this modern world, that's okay. Really.

We are all still trying to understand what has happened in the last two decades.

It was not a simple technology that emerged.

It was not a simple change in their way of life.

It wasn't a device, an app, a service, or a product.

There were simply dozens of radical transformations. Dozens!

Each of them, individually, would already deserve years of study and appreciation, due to their high degree of transformation and innovation. Now, imagine, all of them happening simultaneously.

Just yesterday your work was carried out in the office, with your colleagues. An activity completely disconnected from your domestic and family life.

Today you work from home, taking turns between calls, reports, articles, emails, playing with your son, receiving delivery, and listening to neighbors' renovation.

At the drop of a hat, the process of meeting someone, flirting, has migrated from smiles and looks at the bar, to messages, likes, and reactions on social media. Today, the vast majority of relationships have their first contact over the internet and their dating protocols have needed to be updated.

Not long ago you were moving around the city alone, in your car. Today, you have a network of private drivers available to help you with your daily transport.

Not long ago, you traveled to other cities by bus or car. Today, you can hitchhike with complete strangers, and also stay in the homes of people you didn't know until then, instead of hotels.

Until yesterday, your only source of news was the standardized and superficial mainstream media, always bringing the same package of mass information. Today, there are thousands of sources and often hundreds of different approaches and points of view on the same fact. And now, you are one of those sources too. You are an information agent, not just a passive consumer.

Without even realizing it, children's games left the streets and went to the screens. Children spend hours in virtual universes fighting, building realities, interacting in a network, overcoming challenges. There are thousands of teenagers who have become world celebrities as eSports professionals.

How did this happen so fast?

In 10 years, an industry that didn't even exist, today is worth +$2 trillion. Cryptocurrencies. Money, which was once entirely state-controlled, is now created and maintained by a network of ingenious volunteers around the world.

Your work went to the Internet, your friends, your money, your leisure, your source of information, your flirting, your shopping, your transportation, your services.

It's definitely no small feat.

Even though this means a lot of opportunities and progress, our brain is still not ready for such a change, and in such a short of time.

So, congratulations! You are handling this transformation very well.

When you feel anxious and a little lost, know that you are not alone. And that is totally understandable.

Let’s learn to live in this brave new world together, and enjoy the best that it has to offer.