9 votes

A group of crypto enthusiasts named Krause House DAO are raising money to buy an NBA team

5 comments

  1. [4]
    spit-evil-olive-tips
    Link
    previous discussion of the attempt to buy a copy of the US Constitution by another DAO as I said in that thread, we've gone from speedrunning the reasons banking regulations exist to speedrunning...

    previous discussion of the attempt to buy a copy of the US Constitution by another DAO

    as I said in that thread, we've gone from speedrunning the reasons banking regulations exist to speedrunning the reasons corporate governance exists.

    the article says they've raised $4 million out of an estimated $1.3 billion necessary to buy the cheapest NBA team, the Memphis Grizzlies. so it's a long way off, but let's give them the benefit of the doubt, and suppose they can raise sufficient money to buy a team. what next?

    do they hire & fire the head coach and general manager via DAO voting? how much autonomy do those people have over the rest of the front office staff? (in the worst case, is every single employment decision the team makes put to a vote of the token-holders?)

    the entire problem seems to be that people like DAOs because they're decentralized and off in some magical web3 world disconnected from everything else...but they also want DAOs that control real-world artifacts, like a copy of the Constitution or a basketball team.

    at a certain point you no longer have "oh it's all smart contracts" accompanied by furious handwaving. eventually you get down to, there's a guy, and he's looking at a computer, and reading the results of some "binding" vote taken by the DAO. and he's supposed to go then take the real-world action decided by the DAO. and he might decide to, just...not.

    and is there any recourse? do the investors in the DAO even know the name of this guy who's supposed to carry out these real world actions dictated by the "smart contracts"? can you take him to court (in what country / jurisdiction?), and try to convince a 70 year old judge that he had some sort of fiduciary responsibility to follow the vote of the DAO? good luck with that.

    14 votes
    1. AugustusFerdinand
      Link Parent
      It's a non-story for attention because no league is going to let them have a team. Even if some two bit league did (say the USFL or XFL or one of the hundreds of UK soccer teams) they'd have...

      It's a non-story for attention because no league is going to let them have a team.

      Even if some two bit league did (say the USFL or XFL or one of the hundreds of UK soccer teams) they'd have contracts laid out for all of the for instances you mentioned and more that define legal jurisdictions, what can and cannot be done with the team, on and on, because when it comes down to it the league isn't going to allow an owner to do anything that will damage the team or, to a greater extent, the league.

      One more crypto cry for attention because that's the only way crypto can function.

      8 votes
    2. stu2b50
      Link Parent
      From what I've read of the constitution DAO "thing", they'll setup a LLC with some executors and some contracts that state that the executors are duty bound to do what the DAO owners vote to do....

      From what I've read of the constitution DAO "thing", they'll setup a LLC with some executors and some contracts that state that the executors are duty bound to do what the DAO owners vote to do. Kinda begs the question of why reinvent corporate ownership if you're going to need a corporate ownership anyway to tie DAO votes into real life action, but that's never stopped anyone in the space.

      They hypothetically could vote to fire any particular staff, or anything else that an owner of an NBA franchise wanted to do.

      I don't think that has anything to do with smart contracts - it'd all be "dumb" contracts, e.g real life contracts that bind everything together. I suppose you could call the voting mechanism a smart contract, but in general that's a different thing (of which has been dubiously effective - it's hard to write law or code without loopholes, but part of the "benefit" is that smart contracts are immutable! - but think of a smart contract more like a vending machine).

      Of course, this is all ridiculous, because regardless of the lakers playing in the Crypto.com arena, there's no way a DAO buying a franchise would be approved by the NBA - not to mention they'd need, uh, a lot more money.

      4 votes
    3. meff
      Link Parent
      I'm curious what the point of posting this is, given your perspective. Are you looking for someone to discuss the contra side?

      I'm curious what the point of posting this is, given your perspective. Are you looking for someone to discuss the contra side?

      3 votes
  2. imperialismus
    Link
    Fan-owned clubs are a thing. The majority of the clubs in the German Bundesliga are majority fan-owned due to the 50+1 rule (member associations must retain a voting majority - this rule has some...

    Fan-owned clubs are a thing. The majority of the clubs in the German Bundesliga are majority fan-owned due to the 50+1 rule (member associations must retain a voting majority - this rule has some exceptions but applies to the majority of clubs at present). Things can get chaotic but ultimately the system has been in place since 1998 (before that, clubs did not have private ownership at all) and neither the teams nor the league has collapsed. It works.

    The novel idea here is that membership is tied to an NFT and general assemblies are conducted via digital voting. I assume there needs to be done some legal legwork to tie the crypto stuff together with traditional corporate law. But I don't see how the idea is fundamentally different from a corporation that is controlled by a membership club, like Bayern Munich.

    The idea that cooperatives or membership clubs can't work when they already exist, have existed for more than a hundred years, and in many cases are highly successful, is a little ridiculous. A crypto-coop is just an old idea packaged in buzzwords for a new generation.

    3 votes