The Futarchy System & The MetaDAO on Solana

Seb Montgomery

29 Feb 202416:29

Summary

TLDRThe video introduces 'Metad', a groundbreaking Decentralized Autonomous Organization (DAO) in the crypto world, enhancing excitement with its use of 'Futarchy' for governance. This system leverages prediction markets, allowing traders, rather than politics, to determine the success of proposals, aiming to make more rational and corruption-free decisions. The creator details their journey of discovery and research into Metad, highlighting its innovative approach to decision-making and its potential to transform crypto's future. With examples like IBM's leadership and stock performance, the video illustrates how Futarchy could offer a more effective governance model, emphasizing Metad's role in pioneering this change.

Takeaways

😀 The MetaD is an exciting new DAO focused on using futarchy, a governance model based on prediction markets, to make better decisions
📈 The native token for MetaD, META, has seen huge price appreciation from $1 to over $1000 per token recently
🤝 MetaD was founded by Profit and others to demonstrate real-world applications of futarchy
🎴 Futarchy uses trading incentives and markets to decide if proposals should pass or fail
👥 Allowing traders and markets to govern can prevent bad decisions caused by corrupt politics
🔮 An upcoming MetaD proposal is offering Futarchy-as-a-Service for other DAOs to use for governance
🚀 The speaker believes MetaD has major potential to expand to other chains and one day even to countries' governance
📉 The IBM case study demonstrates how poor leadership and governance can destroy shareholder value
✅ Futarchy prevented a whale manipulating markets in a recent MetaD proposal attempt
🎓 The speaker aims to educate more people on MetaD and futarchy through ongoing content

Q & A

What is Futagi and why is it needed?
-Futagi is a system of creating a better future by using prediction markets for governance. It is needed because people do not make the best decisions when there's politics involved, which is often corrupt and inefficient.
How does the trading system in Futagi markets work?
-In Futagi markets, there are two markets for each proposal - a 'pass' market and a 'fail' market. Traders have to actively trade in these markets, pushing the price up or down. At the end, whichever market has the highest time-weighted average price (TWAP) over a threshold wins, and the proposal passes or fails accordingly.
Why can't whales easily manipulate Futagi markets?
-Because traders have to put up economic risk in Futagi markets. Even if a whale tries to swing the vote, other traders are incentivized through potential profits and losses to counteract the whale's actions.
What was Proposal 6 in Metad?
-Proposal 6 was a request by Ben Hawkins to mint 1500 Metad tokens at a 40% discount in exchange for $250,000 in USDC. Despite Ben actively trading to push the 'pass' price up, the proposal ultimately failed.
How much is one Metad token currently worth?
-As of March 2023, one Metad token is worth over $1000.
What does the speaker hope Metad does in the future?
-The speaker hopes Metad provides Futagi-as-a-service for other DAOs, allowing them to experiment with prediction market governance on smaller proposals first. He also hopes web2 companies and even countries adopt these practices.
Why does the speaker criticize former IBM CEO Ginni Rometty?
-The speaker criticizes Ginni Rometty for IBM's poor stock performance and failure to capitalize on emerging tech trends like AI during her tenure as CEO from 2012-2020.
What does TWAP stand for and why is it important?
-TWAP stands for Time-Weighted Average Price. It is the metric used in Futagi markets to determine which proposal market - 'pass' or 'fail' - is the winner.
How can projects integrate with Metad's Futagi system?
-Projects can potentially lock up their governance tokens into a smart contract, bridge them over to Metad, and allow holders to trade futures representing votes on proposals. Metad would facilitate the markets.
What does the speaker see as the limitations of snapshot.org?
-The speaker argues that snapshot.org, used for voting in the EVM world, still allows whales to easily manipulate outcomes at the last minute with no economic risk, compared to Futagi markets.