The Future of Work for the Gig Economy

by Nick Niver

I've heard the term "future of work" thrown around for a long time now, with reference to everything ranging from agile transformations and the gig economy to the "new normal" of hybrid work schedules. While each of these advance iterative change to the organizational models we all live and breathe each day, I've recently been entrenched with absorbing a topic a fractionally small circle of my network is talking about: Decentralized Autonomous Organizations (DAOs for short). As I explain below, there's good reason to rethink what we consider the future of work.
 
Before I dive into the application and impact of DAOs, allow me to lay some foundation:
 
We've all lived through web's evolution over the past two decades, but we tend to gloss over the underlying shifts that have made the biggest impacts; so let's reflect. "Web 1.0" was largely a push of content from providers to users, purely for information sharing. "Web 2.0" came about with the flock to online platforms, fostering user to user connections and sharing of user-generated content (for both fun and profit). As these platforms scale, we're all witness to their entanglement in the politics of society and biases of the corporate engine for the almighty dollar. As a result, we're hearing growing calls for decentralization of information from the platforms we use (and depend on) today.
 
"Web 3.0" trades platforms for protocols. Protocols are open source foundations upon which we can share information without the confines of a particular website or underlying database (why should I have multiple profiles across Twitter, Facebook and LinkedIn when all I want to do is share information with my network?). Hopefully you thought about Blockchain while reading the previous two sentences (I promise I'm not here to espouse on buzzwords; bear with me here). Blockchain is the backbone tech which already supports thousands of protocols used to organize and record interactions of all kinds. My love of Dogecoin highlights a prime and well-known example of the application of blockchain to decentralize the control of currency through a widely accessible protocol (or at the very least, make me smile when I see the Shiba). The next building block of decentralized protocols was the advent of smart contracts via the Ethereum blockchain. Smart contracts are akin to applications, data and code stored and executed on the blockchain. Most importantly, the data and code are openly transparent, and are not owned or hosted by any individual or corporation. Revisiting my social platform example, imagine your profile is stored in a smart contract that can be updated, freely accessed and shared across the web. Your thoughts and ideas are not shared via posts. Rather, the actual work you do - Your profile is intrinsically linked to other contracts that house your prior work and exhibit your accomplishments. Who needs Twitter, Facebook or LinkedIn now?
 
The advent of smart contracts and the protocol-driven web brings us to DAOs. Smart contracts can reference one another, together executing a chain of tasks (or representing physical world activities) to perform calculations or otherwise produce valuable outputs from a variety of inputs. They can even store value in the form of digital capital (cryptocurrency), automating payments for services rendered. Perhaps most importantly, joining a DAO and contributing to the success of the protocol can be rewarded with tokens representing ownership (as voted on by existing token holders), yielding equity stake and voting rights on future decisions. A DAO is officially "formed" when a smart contract (or set of contracts) is used to memorialize the function of the DAO, and a total supply of tokens is defined by the creator. From this point on, tokens can be rewarded for contributions from the wider community. The open market can invest in a DAO by buying tokens, and as demand increases the value of the token appreciates. It's this "tokenomics" model that incentivizes entrepreneurs and contributors to grow the DAO.
 
One of the largest DAOs today is Aave (as of this writing, the equivalent of $775M has accumulated on its ledger), a protocol built to connect depositors (lenders) and borrowers in order to earn interest on Ethereum token assets and access liquidity, all the while eliminating the middleman institution (akin to banks in our physical world). Rather than building a platform to control and facilitate the exchange of funds, the minds behind Aave developed a set of smart contracts to govern the process of setting interest rates and exchanging funds in a secure, automated manner (check out the initial whitepaper here). Oh, and 100% of the interest flows back to the depositor; far from the .02% APY Bank of America yields on your savings account. This presents a real threat to today's banking industry; once protocols adapt to be user-friendly and accessible, they'll be widely adopted. Aave continues to evolve through ongoing contributions by the network of contributors, who are gaining experience, equity and reputation for their work.
 
So why do I think DAOs are the real future of work?

• Big changes are in store for corporations once the blockchain is easily accessible to all:

  • The right building blocks are in place to support and incentivize the formation of self-organizing communities aligned to a common goal. When starting a business, entrepreneurs will face a hard choice to start it on or off the blockchain as they evaluate the tradeoffs of traditional corporate (closed) structures and the decentralized mind hive. Do I build a platform to independently grow, manage and evolve while focusing on profitability (trusting that I have the right network and resources at my disposal), or do I place trust in a protocol for a decentralized community to openly contribute and grow (trading some of my equity ownership for access to the talents of contributors across the globe)?

  • As DAOs gain popularity, the democratization of corporations will normalize through the expectations of employees. For those businesses that refuse to adapt to a contribution-based model, employees will find better opportunities.

• Individuals will be incentivized to take advantage of a protocol-based world:

  • The gig economy is shifting the talent pipeline from tenured corporate long-haulers to freelance independent workers.

  • Individual contributions will win over corporate tenure and politics.

 
In writing this piece, I remember how exciting it was to sign up for a Facebook account with my newly minted university .edu email address (which was required to join early versions of Facebook). The platform web seemed transformational; possibilities to connect and share were abound. Sixteen years later, an entire generation raised on the platform web is entering the workforce - highly adept in making their mark in a sea of digital content and influencers. The protocol web is ripe for adoption.
 
I've only just scratched the surface in sharing these thoughts; I encourage you to dig in and develop an understanding of this admittedly esoteric topic to better appreciate what it means for you, personally and professionally - I will be doing the same. In the meantime, I'd love to hear your thoughts.