Introducing Trustless Business and Tez-Based Voting
dOrg’s Andrei Taranu explains Homebase’s new “Trustless Business” feature and tez-based voting for Tezos Ecosystem DAO governance.
When it comes to building out a robust and functional blockchain ecosystem, governance matters. The ability to implement transparent, verifiable, and smooth voting processes isn’t just a feature of blockchain technology, it’s a fundamental principle baked into this powerful technology’s very DNA.
Here in the Tezos ecosystem, the teams at Tezos Commons and Web 3.0 development collective dOrg have been hard at work for quite some time on Homebase — a decentralized autonomous organization (DAO) creator and explorer built to make DAOs more accessible and seamless.
In its ongoing quest to streamline DAO functionality and empower businesses to transact efficiently on-chain, the Homebase team is rolling out a couple of interesting new features: A “Trustless Business” platform with built-in escrow and dispute resolution, and a tez-based voting option for off-chain DAO polls. Tez-based voting is initially aimed at more directly involving the wider Tezos community in the voting process for Tezos Ecosystem DAO proposals, though any DAO on Homebase will have access to the feature.
To understand exactly what these new features will look like in practice (and why they are important), I reached out to Andrei Taranu, decentralized product manager at dOrg, and one of the driving forces behind bringing these features to life.
What is “Trustless Business”?
“Trustless Business is an on-chain substrate for economic arrangements with built-in dispute resolution. It enables individuals and organizations to engage with each other without needing a traditional contract, while still retaining the low-risk profile that’s typically provided by jurisdictions with a functioning justice system.”
What problems with on-chain/off-chain transactions will this feature solve for businesses?
“It’s essentially a template for making a contract between a producer and a consumer of goods or services, with a built-in mechanism that allows a designated third party to adjudicate disputes and decide how to allocate funds locked in escrow. One key differentiator is its permissionless character: At no point does this platform require the participants to provide their natural and/or legal identity. The smart contracts are describing an architecture of incentives which is self-sufficient, meaning that it can operate without any off-chain resources. Fairness is an emergent property of this logical architecture, resulting from having the arbiters financially motivated to maintain an agreeable public history of rulings for themselves.”
How do you envision this feature being implemented by businesses moving forward?
“All current business arrangements involve a contract. Trustless business is simply an alternative way to create/enforce those contracts. It claims to provide a viable replacement for the mechanisms that traditionally ensure fairness. At this point, we’re putting out a minimally viable product, and while we’re confident in its viability from the game theory simulations that we’ve conducted, we recognize the stark contrast between the extensive recourse actions available in traditional justice systems — like multi-level appeals, precedents, and trial motions — and our barebones solution. We had to strip down the economic agreement into the most basic unit of measurement, which we call a deliverable so that we could keep disputes neat and focused. From an administrative perspective, businesses might find such a modular framework quite strange and unfamiliar. At the same time, we expect that the value proposition that is permissionless economic activity will resonate far and wide, attracting a diverse range of users, because it is touching upon pain points in three verticals: freelancer marketplaces, escrow services, and project crowdfunding. Since we’re on the topic of future developments, it’s worth mentioning that a platform like Trustless Business is not only agnostic to the identity of its individual users but also to their nature — whether they are human or not. While within our standard economic environment automations are likely to face mounting pressures and regulatory constraints, our platform can be a safe operating space for humans and machines alike.”
When will Trustless Business be rolled out?
“It will be officially rolled out in June or July of this year, but the landing page is already up. People can already go there and put in their wallet addresses to register. When Trustless Business goes live, it will be on Etherlink.”
On to tez-based voting. What were the reasons behind implementing tez-based voting for the Tezos Ecosystem DAO?
“Tezos is a fundamentally crowd-sourced ecosystem, so our view was that taking this approach goes to the very core of the technology. People believed in this tech enough to buy the token, therefore they should have input into which grant proposals should be awarded funding from the pool of funds they helped raise. Tez-based voting empowers people who hold tez to vote based on their personal stake in the ecosystem represented by the tez they hold.”
What will tez-based voting look like in practice?
“Tez-based voting in the Tezos Ecosystem DAO will look like any other Tezos voting process, with the only differentiator being that individual votes are weighted according to how much tez you hold — as opposed to a unique governance token.”
As he always has, Andrei Taranu remains steadfast in his belief that the DAO model represents not just a vastly more efficient method for governance, contracts, and dispute resolution, but also an extremely important use case for Tezos and other blockchain technologies. Blockchain’s fundamental structure, transparency, and immutability, he believes, make it an ideal framework for democratizing real-world processes and organizations, something he spoke about during his recent appearance on TezTalks Radio…
“If you compare on-chain DAOs to any other kind of governance method, this comes out on top. If you compare it with just yelling “yay” or “nay” in a room or stamping paper ballots or even electronic voting which is centralized on servers, this is much more secure and transparent. With a blockchain-based DAO, everybody can trust that the decisions of the voters will be reflected in the actual outcomes.”
Add to this the technology’s baked-in ability to evolve and adjust based on input from voters within the ecosystem, and you’ve got a recipe for a highly efficient, entirely decentralized, and transparent decision-making framework — all complete with a level of transparency notably absent from the traditional frameworks which preceded it…
“The advantage of having it be a fully digital system is the fact that you can endow it with upgradability from the get-go. Just as the Homebase contract can be amended, the same is true of Trustless Business contracts, where the community — which is accounted for by the earnings, spending, and holdings that they have on this platform — can make proposals to change various functionalities and pipelines. This enables things to change very rapidly.”
With these new features in place, the team at Homebase has helped the Tezos ecosystem take an impressive step forward in the quest to show the world what on-chain governance has to offer. And, as these features make their way into the public consciousness, it will be fascinating to watch their impact — not only here in the Tezos ecosystem, but across the rapidly evolving world of business and commerce.
