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DACs: Own Stock In Your Favorite Marketplace

Distributed Autonomous Companies (DACs) are part of the brand new blockchain 2.0 revolution. DACs are very similar to regular corporations, expect they work without humans and run autonomously on a network distributed all over the world. DACs can give profits to shareholders, hire employees and much more. Fully replacing the today’s corporation with the same computer code that gave bitcoin life.

The same way the P2P currency, bitcoin, allowed currency to be transacted without gatekeepers to regulate and control the market. DACs are doing the same but for business structures and stocks. This could have amazing effects on the deep web. Due to the nature of the deep web, having proper financial instruments like stocks or corporations is very difficult. Such instruments require systems of checks to prevent fraud or the whole system is worthless. On deep web people stay anonymous at all costs, preventing things like stocks or corporations to exist. Up until now, you needed to know who other people involved but that is starting to change. DACs allow for individuals who don’t trust or know each other to own shares and govern a company.

The deep web has been mimicking the clearnet in many ways and making it hard at times to distinguish which is, is which. Marketplaces have E-bay styled reviews about products that allow users to see what people thought of the product. Garms, mockingly styled like Google, allows you to advertise your product and for users to search the ever growing list of products. Crypt has been bringing crisp and beautiful graphics to the deep web. All of this is making the old difficult and behind deep web a thing of the past and putting it on par with the clearnet. But DACs, are efficient and anarchic answer to business finance and governance. Something that could bring the deep web to another level.

DACs are a new and developing concept but below is the current structure and components of a DAC.

Crypto-Shares

Crypto-Shares are units of value that represent a right to profits of the company those shares are issued from. It works the exact same as shares in the non-digital world. These stocks are stored on a blockchain, similar to Bitcoin’s. A company releases a set of shares which are fixed as shares of that specific company. One key difference between crypto-shares and regular shares, is that regular shares are registered to a specific owner, while crypto-shares can be owned by simply anyone who is in possession of them. They are not registered to any specific person.

Delivering Profits To Share Holders

Delivering profits is administered by a delegate. Delegates are dedicated nodes which are voted into the position by shareholders. Up to 101 delegates can be chosen and the delegates with the highest approval will create blocks in a randomly determined order. Delegate’s server the same function as miners, in that they sign blocks.

Transactions fee are taken as the cost committing an action on the blockchain, such as transferring ownership of a share. These transaction fees are sent to the delegates which process and decide what to do with them. The delegate has two options- reinvest the transaction fee into the network or deliver profits to shareholders. Reinvesting in the network could be hiring a developer to work on the code or running a marketing campaign. The rate of each the delegates does is decided by the delegates themselves. This allows for a competitive marketplace develop for the delegates emerge and allow the most value producing delegates to raise to the top.

Hiring Workers

Hiring workers is still a developing concept but there are two main thoughts on the subject. One option to have a neutral actor such as the developer of the DAC manually choose who. Another option is to create a voting system where shareholders vote on hiring decisions. A voting system like the one I described, has already been implemented in Memory_Coin.

The DAC does not necessarily need to oversee every hiring decision. Instead DACs could be simply be in charge of hiring the leader of departments. The leader of those departments would be trusted with a certain budget and be able to run the department from there. He could hire employees and develop products as he wish. He would not have a free ride though, because the results of his actions, whether positive or negative, would be seen in how much profit the department produces.

There are also three different theories about paying salaries to the employees of the DACs. One is to put aside a portion of the shares and pay employees with the profits of selling those or paid in equity of the company. Another option is that the company dilutes the shares by releasing more shares and the profits of those are used to pay the employees. A third option is to pay employees with the transaction fees gathered by delegates.

The Bitcoin 2.0 Revelation Is While On Its Way

People are seeing that same technology that allowed bitcoin to disrupt currency, could transform the whole financial system. Though, there are many ideas floating around, the one that is getting the most steam and press is DACs. BitShares is one of the main players in the DAC space and recently their crypto-share, BitSharesX blasted through the rankings on coinmarketcap.com. Landing a solid placing in 4 place with only Ripple, Litecoin, and Bitcoin in front of it. As of publication of this article, BitSharesX has a current market capitalization of $ 71,135,057. A impressive number for such a new concept. BitSharesX could be looked at as an experiment to see if DACs have any promise and so far it looks like it seceding.

Other groups are working towards getting DACs off the ground like Counterparty, NXT and Ethereum. Overstock, the huge e-commerce business and huge proponent of Bitcoin has been talking to developers at Counterparty and BitShares to see how a company could become a DAC. Though, they have announced they are just exploring the idea right now, they have released a wiki that is focused on gathering information on DACs.

DACs Effect On The Deep Web

The deep web, but black market in general, has been considered to be a scrappy group of individuals who fail to form real businesses or enterprises. The traditional black market has relied on violence to deal with their problems but the deep web with the power of anonymity and encryption has attracted more peaceful individuals who shun violence. As a result, real businesses have been forming. Businesses that have a brand, that are responsive to their costumer’s worries and wants, and that employ numerous people have resulted.

DACs offers an opportunity to take that to the next step. Offering deep web businesses to raise capital and be more transparent and responsive to the community. Allowing deep web to have more long lasting businesses and not as fragile.

What if the original Silk Road had an IPO (initial public offering)?

The Effects Of The Dark Net Markets’s IPO

  • The Former Silk Road would have been able to raise capital without going into debt or potentially being caught by authorities. That extra capital would be used to build a secure sever housing facility, security tests or developing new products and services.
  • Corporate ownership would allow for diversified ownership, making the SR1 more resilient if DPR was kidnapped (which did happen). Shareholders, with their money at risk, would demand a plan to deal with such a situation and name someone to be next. Shareholders, with their money at risk and a stake in the longevity of the business, shareholders would serve as a second eyes to notice opportunities or problems for business. With more minds thinking about possible problems or opportunists would be able to run the business the better. In general corporate ownership, would result in longer lasting deep web businesses. Longer lasting businesses would cause a more stable deep web.
  • Going public would also cause deep web businesses to be more transparent with what is going on internally with the business. This would lessen the very volatile and unsure nature of the deep web. There would be less hacks and shocks to deep web users. People would be suited to plan accordingly.

The Effects Of DACs on The Whole Deep Web

DACs and IPOs would provide a mixture of incentives of more money to be made and better business practices that result in a more developed deep web. Other businesses would have more knowledge about how other companies are run and thus this encourage successful business practices to spread more rapidly. This result in a more uniform and better experience. The money to be made more stable and longer lasting businesses, as more structure would attract more entrepreneurs from the clearnet to the deep web. Just like when entrepreneurs start businesses in other countries, skills and knowledge are exchanged, which result in better businesses.

DAC hiring practices are a very promising feature. In the DAC hiring practice, the potential job candidate would be interview by the shareholders. This make the process more thorough and objective. Not only that, but the public would also have better knowledge of who working for these businesses. The more knowledge the consumer and investor has, the better they are protected and the more stable the whole market is.

Deep web businesses really don’t any source of capital, other than reinvesting into their company. That can be slow and difficult process because businesses have costs and owners need to eat. IPOs could finally allow deep web businesses to get some capital. Capital would cause a more developed deep web. Deep web business owners would be able to invest time and money into security checks, or new products and features. Raising capital from an IPO would not just for marketplaces but vendors could also sell shares in their company. This would totally transform the deep web.

Could The Deep Web Start Using DACs Today?

DACs are still a developing and new concept and while, they are ready for clearnet use, they do not meet the extra requirements that deep web demands yet. It is possible to own shares in a trustless, peer to peer fashion but still much of the process relays on trust and humans. Delegates are probably the best example. They can only be run by humans with a high level of IT knowledge and require a dedicated sever. The process of electing a delegate makes it less likely a malicious actor would be elected but it is still possible. It is unclear how much damage such an actor could cause but it certainly be disruptive.

DACs need to also have a way of checking the revenue and assets of the company. That feature doesn’t exist yet and without there could be a lot of fraud. Shares are basically rights to a percentage of that company’s profit so without being to independently verify the income, shareholders could be robbed.

Anonymity and security don’t seem to be keen interests of the developers of the various DACs. That is understandable when you are trying to get an idea off the ground but that provides challenges for deep web adoption. Further removing human actors and trust is must in order for DACs to be able to be used on the deep web.

While these are the early days of this technology, it is moving along at a great speed and has massive potential to transform the deep web.

7 comments

  1. tl;dr ? ^^tiiiired

  2. I can’t believe I just wasted a couple minutes of my life reading that steamy pile of shit. I wouldn’t even call it an article or a concept.

  3. Informative article. It would be more professional looking if it was proofread more thoroughly.

  4. Informative how ? This concept of deep web investing is flawed on so many levels I can only imagine it is a joke. Not only would you be trusting a 3rd party but a 4th, 5th, 6th ……. There is absolutely no system in place to prevent scams, fraud or just plain bull shit. It sounds set up just for those purposes. Show this to anybody with a rudimentary knowledge of investing and the deep web and see their response.

  5. I think there’s something here, I’m just not sure what.

  6. So I can exit scam immediately!

  7. Horrible article, holy fuck I think they need a DAC like process on ddw to hire their writers..

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