Comment by arcticbull | Hacker News Reader

Comment by arcticbull | Hacker News Reader

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I mean, where to even begin.

> "To do this sort of capital formation in the traditional finance world, you’d have to use centralized payment processors..."

Oh no. Anyways.

> "... (who would most likely censor you) ..."

Got any examples top of mind? I sure don't. Unless you're on the OFAC list which again, shrug.

> "... it’d be extremely slow ..."

Would it? Wires seem to be faster than Bitcoin by a country mile. Faster than ETH last time I ran one too, and with RTP and FedNow, that bar goes down further - should be as fast as Solana if not faster.

> "... the money raised would be much less ..."

Because it would be real money, not play money. Tokens are closer to frequent flyer miles in people's minds.

> "... and the raise itself would be very exclusionary."

If you mean "open to accredited investors" well, I'm ok with that.

> "You also couldn’t create a DAO out of it and have it be governed by token holders - the traditional system is just not set up to do this in any practical way."

You can't govern the same way via a set of non-binding twitter polls? Or like a SurveyMonkey thing?

The core promise of a DAO (note: I do not feel the ConstitutionDAO is a good example) is that it is funded & organized using smart contract interactions.

For example: a simple smart contract could be set up by 1000 parties that share the same goal (but may not share a mutual trust) across the globe to say that “the funds in this wallet are locked for 1 year. After 1 year, contributors can vote on whether to unlock the funds (make them redeemable) or re-lock them for another year.”

Rather than placing trust in complex legal structures across countries, centralized payment processors & currency exchanges, the security & accuracy of voting procedures like SpiderMonkey, and the goodwill of all other contributors, the trust can be placed in the contract code and security of the chain.

This does not automatically make it better, nor does it mean it is impervious to problems (like bugs in the contract), but it is a different system that is not easily & transparently achievable via traditional means, and certainly not in a matter of days by simply using a web application (Juicebox).

Not sure how it avoids the existing legal system. That seems to be mostly an unconfirmed talking point for those shilling DOAs as something more transformational than they are. Disputes will happen and under current systems, can be resolved through the court system. We've seen this happen already.

We could stand for some competition in rule making, but the current rule makers would need to cede some control.

Yes, participants are still required to follow the laws of their country. e.g. If you made gains on this hypothetical DAO, it isn’t magically exempt from capital gains tax.

The laws around setting up and participating in DAOs are still being defined, but at the moment it is more accessible than creating the same procedures through traditional legal contracts. Maybe that will change.

> > "... and the raise itself would be very exclusionary."

> If you mean "open to accredited investors" well, I'm ok with that.

How dare you. Drug lords and ransomware writers have as much rights to buy the US constitution as everybody else. It's their hard-earned money, they should be able to use it however they want. /s

Can you explain the history of accredit investor laws and how they were designed to keep out criminals? I thought they kept out retail, i.e. the less wealthy.

Criminals are traditionally the opposite and have "legitimate" funds that they have washed through and through using the existing financial system.

Well the OFAC list and AML/KYC laws do that. Accredited investor laws are to stop poor people from getting rekt by snake oil salesmen which led to the Great Depression.

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