Syscoin unveils DAOSYS, a new initiative to revolutionize DAO governance
Bitcoin and Ethereum are arguably the two most popular cryptocurrencies out there. In recent years, the question that always gets asked is, “Which is better Bitcoin or Ethereum?” The answer depends on your requirements and investment goals. But what if you have the best of both worlds by combining the security of Bitcoin with Ethereum based smart contracts? That’s where Syscoin comes in.
Syscoin is a decentralized and open-source project that leverages the best of Bitcoin and Ethereum via a coordinated platform. Syscoin has developed its own Network Enhanced Virtual Machine (NEVM). As explained by its developers, Syscoin’s design keeps intact the “gold standard” security of the Bitcoin consensus mechanism and merged mining while offering the performance characteristics expected in Ethereum’s 2.0 future thanks to L2 ZK-Rollup technology.
We covered Syscoin late last year after the company announced the completion of phase one of its NEVM launch, during which its Bitcoin-secured Layer 1 for EVM smart contracts reached mainnet on block 1,317,500. The upgrade enables users to simultaneously enjoy all the benefits of Bitcoin’s POW security and the flexibility of smart contracts on a modular chain built to remain indefinitely decentralized, scalable, and affordable. Since our last story, the team has been working behind the scenes on the next phase of their project.
Today, Syscoin unveiled DAOSYS, a new initiative that will revolutionize DAO governance. While speaking in Dubai during the Binance Blockchain Week 2022 conference, Jag Sidhu, Syscoin Foundation President, announced an initiative to set a new standard for Decentralized Autonomous Organizations (DAOs). The Syscoin Foundation has embarked on a project that represents what they see as a significant evolutionary step for DAO technology that can breathe new life into the segment. The group also aims to bring forward the first implementation of their revolutionary new model in 2022.
Up till now, DAOs have been universally affected by key issues and have failed to reflect the ethos of cryptocurrency. The fundamental value proposition of cryptocurrency is self-sovereign capital. ‘Not my keys, not my coins.’ Currently, DAOs take ownership of users’ capital by managing it in a treasury controlled by a few individuals. Much like not being able to control the keys to your own wallet. Moreover, the current governance solutions are not suited to respecting stakeholder values. Typically governance does not directly control the protocol, it simply acts as an advisory vote to signers on the multi-sig controlling the treasury. This is further compounded by the typical disconnect between a DAO governance token and the protocol’s actual value proposition.
DAOSYS aims to solve these issues with a revolutionary model for coordinating cryptocurrency as capital investments. The Syscoin Foundation’s view is that DAOs should operate more like pure AMMs; an autonomous and permissionless protocol anyone can use to consume the services of the DAO, effectively acting as autonomous economic agents. This means that DAOs have to mature from the current phase of maximizing capital extraction. The economics must be tailored to facilitate the DAO’s mission statement and be implemented in a manner that does not require external controls.
Prior to this initiative, it was nearly impossible to establish a proper DAO with the state of smart-contract and DeFi design. But, by iterating on the AMM model to generalize the process, it’s possible to deploy DAOs as easily as a liquidity pool. By applying antifragile tokenomics and integrations with DeFi protocols, a treasury management platform can be realized without the need for a governance token. The DAOs of the future can leverage existing markets as the foundation for coordinating capital to execute mission statements. This technology – the Autonomous Service Engine – is present in DAOSYS.
DAOSYS will consist of a reference architecture using the Autonomous Service Engine to make Syscoin a hotbed of innovation through self-sovereign asset management. The antifragile market design results in a risk-mitigating funding mechanism. This shifts the primary risk in funding new projects and initiatives toward simple opportunity cost, leading to some incredible efficiencies for the Syscoin Foundation’s treasury and for others who participate. DAOSYS will be advantageously positioned to foster digital value from the roots, upward, because it is oriented to drive the advancement of Syscoin’s ecosystem, a full-stack Layer 1 blockchain with a modular design that supports a scalable Layer 2.
This initiative and its DAOSYS implementation are part of a larger goal of the non-profit Syscoin Foundation, to provide the advancements necessary for DAO technology to disrupt for-profit corporate and NGO finance by becoming a go-to driver of innovation.
Founded in 2014, Syscoin is a decentralized and open-source project whose NEVM blockchain combines the best of Bitcoin and Ethereum in a single coordinated modular platform. Syscoin is ushering in the next step in the evolution of blockchain technology, providing Bitcoin’s proven security and Ethereum’s Turing-complete programmability elevated to true scalability via ZK-Rollups and other Layer 2 technologies.
The project is represented by the nonprofit Syscoin Foundation which is registered in Eindhoven, Netherlands.