Web3 DAOs: Imagine voting on the fate of your favourite book character? Or collaborating on your most streamed artists’ new track? Ever dream of calling the shots on the latest designer drops?
In Web3, that could become a reality.
Soon, you — a fan, a consumer, a supporter — could be calling the shots about what your favourite sports team, film studio, musician or fashion brand does next.
Here’s how it works
Web3 is being built as an antithesis to the Internet, and capitalism, as we know it.
Entrepreneurs and developers are creating applications that run on blockchains that promote decentralised ownership, transparency and community-building.
Community is one of the central principles at the heart of Web3.
The general consensus is that decentralised community ownership will help projects scale without the “middlemen” — Big Tech, streaming platforms, traditional publishers or corporate funding.
In this “power to the people” structure, “community members” (people like you and me) are promoted from being fans, to co-owners, co-collaborators or investors.
CEOs, corporate hotshots, and shareholders are no longer the only ones in the driving seat.
I won’t lie. My first impression of Web3 was that it’s a solution in search of a problem.
I want to trust that the fervour is for good reason, but as an ever-curious sceptic, I wondered if I was missing something. Do problems across music, fashion, art and sports call for such a dramatic restructuring of power?
I certainly don’t have all the answers yet (does anyone?) but here’s some food for thought.
Web3 DAOs: Getting amongst the future of music
The music industry is taking to the Internet (Web 2.0) to hype up Web3.
Web3 platforms could facilitate a more direct and mutually beneficial relationship between the artist and their fans. The more engaged a fan community is, the more backing musicians have to break free from the controlling shackles of streaming platforms, algorithmic foundations and corporate negotiations.
To generate mutually beneficial gains, for both the fan and the artist, communities could form decentralised autonomous organisations (known as DAOs).
In these community-led entities, rules and policies are outlined in smart contracts and stored on the blockchain. The more a “DAO” or “community” member contributes, the more “governance tokens’ they receive, leading to greater ownership and decision-making powers. In the music industry, incentives may include receiving a fraction of the royalties, or being directly invited into the co-creation process.
For better or worse, Web3 will transform the artist-to-fan relationship.
DAO’s like Songcamp, a DAO based around music co-creation, and Good Karma Records, community owned record label, describe the future of music as one where “fans become friends” and in need of “a convergence between fans and the artists they supported”.
In Web3, however, the excessive focus on “community-building” could erode freedom and stymie creative expression. Similarly, musicians now at the whims of their DAO community, may feel pressure to give up control and crumble under the weight of closer, more personal fan relationships.
Music
SXRG, a music producer, audio engineer and songwriter from New York, agrees Web3 is promising as it allows musicians to have a direct financial relationship with their fans – but there are caveats to how much control fans should have.
“I think that’s such a bad idea,” he said on the democratisation of music production. “Steve that goes to work in a cubicle, from 9-5pm should not have opinions on being in the studio, and making music. It’s a different experience. You can have opinions, but you shouldn’t feel entitled to have control over an artist’s work. If we see followers or fans feeling entitled to have a say in music all because they have a financial stake … I don’t think that’s smart on any side”.
I ask Sergei if musicians are at risk of losing control of their careers in Web3. “It’s on musicians to negotiate and decide what it is they’re willing to give up. It’s going to be important for artists to set boundaries”.
What about sport DAOs?
Professional sport is largely about profit over passion, with teams owned by corporate magnates like real estate magnate Stanley Kroenke and fracking billionaire Terry Pegula.
BuyTheBroncos, a Web3 DAO attempting to buy the Denver Broncos, wants to change that, stating “the time for fan-ownership is now. While BuyTheBroncos is currently made up of attorneys, accountants and pro-athletes, the intention is to “invite fans from all walks of life” to be owners.
A structure that grants fans, some retired sports players, others armchair experts, tokens to decide how a team is run, what players to sign, match day logistics and training schedules, to me, sounds like a formula for disaster.
Turns out fan ownership can actually work (Real Madrid and FC Barcelona are two successful, fan-owned clubs).
Web3 could enable sports teams to benefit from altruistic fan motives, and avoid outcomes clouded by profit gain (as seen with corporate ownership), or personal inexperience (as expected with fan ownership).
The decentralised nature of DAOs would fairly disperse voting power to ensure decisions are balanced between the intentions, knowledge and skill of all DAO members. Then, the transparency and traceability of blockchain technology would keep profits within the clubs, and reduce the likelihood of financial mismanagement.
While sports fans can be highly emotional, at times tribalistic, a shift in power dynamics – from profit to passion — could catapult sport towards a promising future.
Are the DAOs for art and literature?
Admittedly, I’m a poor team player who thrives in the solitude of self-employment. Therefore the “creator economy” appeal — where creators can connect and collaborate with their audience — is everything but.
In a similar vein, I am struggling to “get” the point of levelling the playing field between the skilled and unskilled.
According to Forgotten Runes co-creator Bear, “the balance between the two can yield incredible results”.
Forgotten Runes Wizards Cult is a decentralised media franchise involving a community of 10,000 Wizard NFTs in its production. On the same wavelength is Mogul Productions, a film-focused blockchain project inviting fans into the film-making process.
I asked Forgotten Runes’ second co-creator Dotta, about the value of community-owned and community-decided content and entertainment, and for whom democratising creativity benefits most.
Web3 DAOs: Humans
Humans have always had an “inherent desire to create”, he told me, but the structure of creative IP projects means this ”impulse to create” is often lost or hindered.
As an alternative, Forgotten Runes Wizards Cult is experimenting with decentralised IP ownership to create an open-sourced fantasy world, like Lord of The Rings or Harry Potter.
Instead of “Ron Weasely” belonging to Warner Brothers, community members create and own their wizard characters, through NFTs, and are invited to contribute stories, art and knowledge to a larger fantasy world: the “Book Of Lore”.
Screenwriter Derek Kolstad will then draw upon these entries and themes to produce a TV show and comic book. Chosen contributors will receive compensation. Now with a direct investment in the success of the project, the 10,000 strong community doubles as Forgotten Runes Cult’s marketing, sales and distributors team.
Could a community of dreamers, fantasy fans and amateaur creators create something better than a Hollywood production company? Time will tell, but it’s exciting to see how these Web3 projects could play out.
OK, what about fashion DAOs?
While major fashion houses are embracing blockchain technology and token-based exchanges in the form of IRL event access, giveaways, exclusive merch drops and virtual viewings; Web3-native fashion brands are more enthusiastically leaning into the community spirit of Web3.
There’s Clubhouse Archives which allows Membership Pass holders to participate in the product development process by casting their vote on colorways, trims, and overall aesthetics. Made with Love encourages consumers to be investors and Saint Fame, a DAO described as “The world’s first internet-owned fashion house” that plans to give owners tokens to vote in its strategic direction.
So, what would happen if the rest of the fashion world catches on to Web3’s community-first ethos?
While the tides have turned on fast fashion, overconsumption and “haul culture”, overproduction is still a problem within the industry, ranging between 30-40% each season. Around 85% of textiles discarded in the U.S. are dumped into landfill or burned.
Web3 DAOs: Community-owned
The rise of “community-owned” fashion could, for a start, address the overproduction problem.
If fashion designers and labels are prepared to grant community members “voting power”, in return for investment or ownership, it would ensure garments will be well received by their consumers.
While mainstream fashion is heavily influenced by community demands; luxury or independent designers take pride in setting the standard of “taste”. Community ownership and “crowdsourcing” may amount to nothing more than a niche market activity, but still should not be underestimated as a way of reducing the environmental burden of the industry.
The question of whether Web3 will be a passing fad or cultural revolution remains unanswered.
Perhaps Web3 convinces us to rethink power and creative value, enough to welcome decentralisation and community ownership. Or perhaps creators waste time, money, and passion, on communities that go on to lose interest, steam and incentives.
Web3 will no doubt reverberate outside the virtual realm, and have real-world implications, many promising, others concerning.
As I sit back and watch it all unfold, I’m choosing to sip, not chug, the Web3 KoolAid.
