DAOs as Vehicles of Shared Growth in Web3
While the typical picture of working a 40-hour week for a single employer is slowly falling into irrelevance, the tech industry experiences more freedom of choice over where, when, and what they work for. While profiting from new compensation models for their contributions.
Instead of just exchanging time for money, people own equity in their work. They can involve themselves in numerous projects while tedious tasks are being automated by smart contracts. Workers have more time to engage in tasks that demand creativity over resilience. By receiving incentives like equity in the form of governance tokens, they directly benefit from being actively aligned with the organizations they engage with.
To freely quote Chris Dixon’s tweet about the evolution of the internet: „Web1 was read-only (directories), Web2 was read-write (social media), and Web3 is read-write-own.“
As Steve Glaveski points out in his article on how DAOs will change the way we see the modern workplace, decentralized autonomous organizations are set to be the vehicle to lead the charge of a new work paradigm by allowing us to own a piece of the organization’s equity and choosing the amount of our involvement freely. While most workers feel disengaged at work in established work sectors, there are numerous exciting models for earning an income than just „work to earn“ out there.
X to earn
Where in the past, only a few people could generate multiple sustainable sources of income, digital natives and tech affine individuals can decide between a plethora of different ways to create an income nowadays. Play-to-earn models are one of the more famous sources of revenue. While they seem to be a niche way to make a living, the renowned game Axie Infinity has a market cap of around 2 billion $ and a player base of approximately 2,000,000 active players at the time of writing this.
An even more significant and exponentially growing playfield is decentralized autonomous organizations or DAOs. As mentioned before, DAOs are the vehicle for transitioning the work-to-earn economy into a bounty-based contributors economy where people align themselves with the projects they’re involved in rather than putting 100% of their time into one job at one company.
Decentralized autonomous organizations already managed over 10 billion $ in assets in 2021 and differ vastly in their causes and goals. This economic diversity creates a massive amount of different governance tokens awarded to contributions for completing tasks. Managing these additional tokens and swapping them (e.g., for stable coins) might create unnecessary taxable events or transaction costs that have a detrimental effect on one’s income.
Managing Income from Multiple Sources
As a growing number of people hop between employers, the transfer of thoughts and ideas becomes more regular. Thus, DAOs intertwine in their communities and grow into a more or less decentralized network of stakeholders of each other’s treasuries. While some DAOs rapidly diversify their treasury across the DeFi space, contributors face the challenge of potentially having to learn an entirely new subject.
Swapping tokens of numerous DAOs can be detrimental to one’s income, as gas fees can get high and prices are prone to increased volatility. To solve this, multiple DeFi protocols emerged that offer to generate passive income for investors by providing their tokens to liquidity pools.
Shared Growth through Decentralized Organizations
While investing in DeFi protocols can be highly profitable, single investors can get rekt in no time if they don’t know what they’re doing. This is where DAOs come in as vehicles for shared growth. Instead of actively managing income from multiple sources, web3 contributors can benefit from the power of collective investments via specialized DAOs compared to classic organizations like retirement funds.
We founded Pen-X to serve this cause by creating a decentralized managed investment fund that specializes in long-term growth and provides the needed expertise to solve the question of managing assets profitably in the long run.
Social security is still a widely uncertain subject in many areas. Pen-X creates one of the first retirement funds in the DAO ecosystem that serves both individual investors and DAO-to-DAO business inquiries. With this type of service, short-term growth management and questions about providing financial security for workers towards their retirement will be solved. As we move towards a decentralized landscape of transparently working companies, it is as clear as ever that the demand for social security has to be solved in a diverse and decentralized fashion.
Pen-X is here to evolve how we think about retirement funds in web3. Investments will be actively managed by specialized committees for different financial products. While fund-baskets will come in the form of crypto, our managed assets consist of DeFi products and various products in the range of tokenized stocks or commodities. Committees propose strategies to the community that will be able to vote based on their level of involvement in the DAO. To provide long-term value for investing in the Pen-X managed funds, investors will be rewarded governance tokens for each month on top of their investments in the fund. We aim to provide shared growth for investors while embedding ourselves in the decentralized network of treasuries by strengthening DAOs and individual investors alike.
We hope to have given you insight into the prospects and challenges that await us in the rapidly evolving world of web3. No matter if you are a contributor to DAOs or in a leading role, we would love you to learn more about Pen-X and the value we bring to the rising demand for social security. Join our Discord and follow us on Twitter for the latest updates on our growing DAO.
Learn more about the vision behind Pen-X in the links below:
Whitepaper (Gitbook): https://docs.penxdao.com