Thanks to DAOrayaki community contributors DAOctor, Will, Younes, Yofu, Herry and Dora Factory Eric Zhang for discussions and feedback.

#1 The need for decentralized media (dMedia)

Media and democracy are intrinsically linked, and in order to achieve democracy, the logical conclusion is that the more media platforms the better, including newspapers, TV stations, editors, writers, technology media platforms, etc.

But now it's going in the opposite direction:

In 1983, in the United States, there were 50 dominant corporate media. As of 2020, there are only five dominant corporate media groups. These five conglomerates own approximately 90% of the media in the United States, including newspapers, magazines, book publishers, film studios, radio and television stations. Even more shocking is the fact that today's giant tech companies have produced another form of concentration of power and expanded the reach of major media conglomerates. Thanks to Internet technology, today's news outlets are more accessible than ever before, while being controlled by the smallest number of owners in history.

The media has changed from representing the will of the people to being controlled by minority shareholders or interest groups. For example, the polarization of opinions, extreme reports, political scandals, partisan struggles, etc.

As the fourth power, the media can strengthen democracy or corrupt it. Centralized corporate media is deviating from the essence of media. Some public media systems (a third type of media system between national media and corporate media) try to build a system that represents the will of the community, but usually end up lacking funds.

A dMedia launched and operated by DAO can achieve two characteristics that centralized media (cMedia) cannot achieve at the same time, namely the adequacy and credibility of the system funds. When a media is no longer trapped by financial problems, its independence and impartiality are guaranteed.

Therefore, DAO can be used as the organizational form of media and its governance model to operate the ecology, so as to realize a media system owned and governed by community members (readers, funders, creators). In this system, readers can directly fund DAO, participate in governance, elect executive teams, formulate rules and content standards, and DAO motivates the entire media ecology according to the rules.

DAOrayaki is realizing a fully functional decentralized medium that represents the will of the community and is owned by its members. We define a fully functional decentralized medium that should consist of three layers:

• dMedia Core Functionality: Funding Contributors, Proposal Voting, and Committee Appointments and Elections

• dMedia intermediate functions: planning, publishing, etc. around media content

• dMedia Edge Capabilities: Day-to-Day Operations

The core function is a necessary means to build dMedia and the only way to empower the community. It is indispensable. The edge function emphasizes efficiency, which is the advantage of cMedia, but it cannot change the nature of dMedia; for dMedia, it can continue to be used. The intermediate function is the extensible boundary of dMedia. These features allow for a free choice between decentralization and efficiency. They can generally be categorized as "content governance", or decentralized editorial boards.

The special attributes of the media determine that the governance mechanism or governance function is very important to it. At present, dGov has a series of problems. If it is not used properly, it will be dangerous for the entire system, and it will even be reduced to a platform representing the will of a few people again.

#2 A series of problems in decentralized governance (dGov)

Voting is dGov's primary means of expression. Currently the main form is token voting.

Token voting can be divided into two categories: one is influence-based voting, such as one person one vote, proxy voting, and quadratic voting; the other is value-based voting, such as Futarchy.

Throughout the run, there were two main categories of problems with token voting:

• Inequalities and Incentive Misalignments

• Attacks of Vote Buying

Unfairness and misalignment of incentives are often related to the mechanism design of the system. Aiming at this problem, various schemes are emerging to try to solve it. Not much to say here.

Ticket-buying attacks are the very essence of dGov's danger. This is especially evident in its influence-based voting mechanism. This is inseparable from the tragedy of the commons of minority shareholders (indifferent voting, random voting), rich participants ("whales") are more likely to achieve decision-making and other reasons. at present. Such attacks are mostly carried out in a covert manner, which eventually leads to the following three phenomena in the decentralized governance system:

• Rent-seeking and Corruption

• Over-emphasize Token Price

• Elite Governance / Elite Will (Elite Rule)

#3 Common Solutions

(1) Limited governance

Through on-chain governance and increased voting time delay, this is not a good solution, especially in areas that are vulnerable to attack. For example, the allocation of funds for public goods. As a typical public good, dMedia has decentralized funding as one of its core functions.

(2) Non-token governance driven

Decentralized governance is realized through the personality proof system and participation proof. Both Proof of Personality and Proof of Participation require some form of anti-collusion (e.g. MACI) to ensure that governance rights are not transferred or sold in smart contracts.

(3) Responsible for voting results

Through reputation loss and token loss, voters are allowed to take corresponding responsibilities for their actions while gaining governance rights (collective governance).

#4 Futarchy-Based Media Governance

As the main source of social information, the media bears certain social responsibilities. Therefore, in the process of implementing democratic governance, the requirements for value voting and value-oriented high-quality participating communities are higher.

In order to achieve the above requirements, Futarchy-based value voting and non-monetary governance tokens are the key means to realize the mission of dMedia.

However, since Futarchy was proposed, its participation has been questioned. Prediction markets are zero-sum games. Participants need to pay other costs besides predicting votes, which is unreasonable for participants. The end result is low engagement, insufficient market depth, and the inability of experts and analyst firms to fully profit from the process of gathering information. In addition, due to the complexity of value and the slowness of policies, Futarchy has not been successfully applied in any government, and it has not even been truly realized in corporate governance.

However, since Futarchy was proposed, its participation has been questioned. Prediction markets are zero-sum games. Participants need to pay other costs besides predicting votes, which is unreasonable for participants. The end result is low engagement, insufficient market depth, and the inability of experts and analyst firms to fully profit from the process of gathering information. In addition, due to the complexity of value and the slowness of policies, Futarchy has not been successfully applied in any government, and it has not even been truly realized in corporate governance.

"Pure" Futarchy is hard to introduce. But the DAO-based Futarchy market (a hybrid form of Futarchy) is more like a positive-sum game. We can model the prediction market as a zero-supply market + additional initial quota, at which point the threshold for participation will be lowered and participation will increase.

Current typical applications include: traceability of public goods funding, decentralized prediction market platform Augur, and decentralized court Kleros.

Futarchy-based DAO governance has two advantages:

• It is difficult to deceive and manipulate the community for short-term gain

• Make governance fundamentally open and transparent

Governance tokens with non-monetary attributes:

Does not have intrinsic value, but has governance authority. Such tokens have the following characteristics:

• Obtained through community contributions

• Represents certain governance authority

• Not tradeable and transferable

Governance tokens with non-monetary attributes avoid the related problems in buy-out voting to a certain extent. Combined with the Futarchy mechanism, it not only guarantees the voting value, but also realizes a high-quality participating community.

#5 DAOrayaki DGov Model

The DAOrayaki DGov model will adopt the above governance mechanism, that is, content governance based on the Futarchy mechanism + community governance token (YakID) with non-monetary attributes. This is yet another extension of the functionality of dMeida. In the implementation of this governance system, topic planning and part of the power of review are delegated to the community, and professionals check the final review and publication, which not only brings into play the creativity of the community, but also ensures the quality and efficiency of the media.

Governance based on the Futarchy mechanism is mainly used in the governance of content ecology: content market, popularity prediction.

Specific steps:

Specific steps:

• Every week DAOrayaki will announce the Grant plan in the prediction market

• Creators who wish to be funded submit a pre-proposal; the creative content is currently only in the DAO field, and can be explained for translation, originality, analysis projects and videos.

• Community members discuss and vote on pre-proposals. At this time, the voting mechanism adopts relative majority voting. If the proportion of votes in favor reaches more than 51% and the number of votes is at least 2, it will enter the proposal queue. The time is 3 days.

• Community editors review proposals that enter the proposal queue. Review criteria: whether it complies with the requirements of the proposal template, whether it contains content that violates the community convention, etc.; for approved proposals, the community editors will rank the proposals according to their votes (if the votes are the same, they will be ranked according to the proposer's YAKID), and the top ten will be selected. proposal. Given its official designation DCP-X. These proposals will enter the content market, while other proposals will fail. Time: 1 day.

• The content market is open, and all community members who hold YAKID can stake on the proposals they want to fund. At this time, the Futarchy mechanism is adopted. Time: The market is open for 3 days.

• TOP - N proposals will enter the pre-funding queue, and other proposals will be considered failures. Among them, N (0 < N < 10) depends on the current Grant plan, and the selected N will be the largest positive integer that makes the sum of grants applied for by TOP N proposals less than or equal to the current grant plan.

• Proposers (creators) who enter the pre-funding queue need to complete their research within 7 days and submit it to the editorial board for review.

• An editorial board reviews and votes on the content, and voted articles will be awarded funding. Voting mechanism: Moloch voting mechanism is adopted. Time: 4 days for review + 2 days for voting + 1 day for issuing Grant and rewards.

• Bettors (voters) whose bet proposals are finally funded will be rewarded according to their share of assets, and each unit of assets will be rewarded with 1 YAKID (1 YAKID for N correct answers) /N YAKID), other voters will lose their pledged tokens. In addition, all voters who participate in the pledge will receive YAKID participation rewards.

The above steps are carried out cyclically, and the prediction market will be opened once a week.

Popularity prediction: This is a process of positive feedback to the will of the community.

1. DAOrayaki opens a hot market once a week

2. DAOrayaki will choose N (5

3. The prediction market is open, and community members holding YAKID bet on the popularity of the article. Time: 3 days.

4. in:

in:

W: Expression of content quality, DAOrayaki Chinese articles: official website + WeChat official account readings, English articles: official website + Medium readings.

I: Content initial quality, set to a fixed value of 1

G: Attenuation weight, content heat decay speed over time, the larger the value, the greater the decay speed, set to 2

T: time in days

1. After the countdown is over, the popularity forecast results (heat forecast trend/current popularity) will be announced

2. The winner of the prediction (current trend = predicted trend) will be rewarded according to the share of the assets he holds, and each unit of assets will be rewarded with 1 YAKID (1/N YAKID for N correct answers), other votes Participants will lose their pledged tokens.

3. All voters who participate in the pledge will receive YAKID participation rewards.

#6 Summary How to bet with Futarchy?

Let us experience the whole operation process together.

If you are a creator, you suddenly have a good inspiration and want to complete an article about DAO governance. Then, you can create a pre-proposal in the DAOrayaki community. If your inspiration is not bad, community members will vote for you and give you valuable opinions. When the pre-proposal time is over (3 days), as long as more than 2 people vote for you, and the support votes exceed 51%, then the community editor will review it. The community editor of DAOrayaki is composed of community members with a certain YAKID, responsible for reviewing community proposals, assisting in modifying the proposal format, etc.

The community editor ranks the proposals according to the voting ranking of the proposals and the number of governance tokens (YAKID) of the proposers, and selects the top ten proposals, and grants them official DCP numbers. At this point, your proposal will be voted by community members holding YAKIID in the prediction market, and the N proposals with the highest price (according to the weekly Grant plan) will be eligible for funding. But don't worry, if your inspiration is good enough, you will definitely attract enough people to vote for you.

Alright, let's take a different look at how this step works. Now, let's change your identity, you are a community member who is good at observing and gathering information, and can always accurately predict which proposals can be finally selected and successfully completed. Then, congratulations, this is the stage for you to show off your ambitions.

In dGOV's content governance prediction market, you can see all candidate proposals in the current period. The price of the corresponding proposal can reflect the probability that the market believes that the proposal will be passed and finally completed. If you purchase the asset corresponding to DCP-2, and it is finally selected and completed on time, then you will get a certain return for every share you buy.

By predicting the market, we found that the price of DCP-2 is 0.125, which means that the current market believes that the probability that DCP-2 can be selected and completed on time is 12.5%. However, since you are a wise participant, you can always see Seeing something that others cannot see, you firmly believe that this proposal is very valuable, and you think that it will be selected in the end and the probability that only this proposal will be completed is 90%, then congratulations, you have found a good profit-making project. method. At this point, if you buy a unit of DCP-2 assets, your expected return will be (at this time, the final correct answer is predicted to be 1, so each share of DCP-2 assets will eventually get YAKID returns):

And the amount spent to buy one of these assets will be determined by the change in C. For example, to purchase x units of W assets, the amount of the fee will be:

Wait, what did we seem to overlook? If the proposers of DCP-2 don't meet the deadline, then eventually the assets of DCP-2 will become worthless as well. So, you check the life of the proposer, make a rough estimate, and find that the probability that he can complete the task on time is only 0.7. At this time, you adjusted your estimate for DCP-2, and the probability that it will be selected and completed on time is only

And you find that the current price of DCP-2 assets has reached 0.7YAKID. If you buy DCP-2 at this time, your expected return will be:

When selling DCP-2 assets directly, your maximum return will be:

After weighing, you decide to sell some assets. As time goes by, you will accumulate more and more wealth in dGOV's prediction market based on your own wisdom.

Alright, let's get back to being the creator. After some incentive competition, your proposal was finally accepted by the community and you got the highest price. At this time, the community editor will notify you to start writing your article. You will have one week to complete your writing and submit it to the editorial board.

The Editorial Board Board is elected by the community and is responsible for reviewing articles and voting. If the quality of your content passes the test, you will successfully pass the committee's vote and finally get the Grant you applied for. At this point, your article will be displayed in various channels of DAOrayaki,

#7 is written at the end:

It is DAOrayaki's mission to establish a credible medium that represents the community's will. Content governance based on the Futarchy mechanism + community governance token (YakID) with non-monetary attributes is another innovative attempt to realize the mission of DAOrayaki. In this stage of governance, topic planning and partial review are delegated to the community, and professionals check the final review and publication. That is to give full play to the creativity of the community and ensure the quality and efficiency of the media. This new governance mechanism will bring new vitality to DAOrayaki, and also provide new guidelines and ideas for the construction and design of dMedia.

#8 References:

1. DAOrayaki: Design a decentralized media operated by DAO https://matataki.io/p/6664

2. A review of the first phase of DAOrayaki - a pioneer in decentralized media https://daorayaki.org/daorayaki/

3. DAOrayaki opens the era of decentralized governance 2.0 https://daorayaki.org/daorayaki-a-deep-dive-into-how-the-top-10-daos-2/

4. Moving beyond coin voting governance https://vitalik.ca/general/2021/08/16/voting3.html

5. DAOrayaki｜MACI: An Anti-collusion Framework in On-Chain Governance https://daorayaki.org/daorayaki-maci/

6. Robin Hansen Classic Papers (4) | Futarchy: 25 Questions about Engineering Design https://daorayaki.org/luo-bin-yi-sen-jing-dian-lun-wen-si-futarchy-gong-cheng- she-ji-25ge-wen-ti/

7. Futarchy | Value voting, belief in gambling, speaking with money, words without evidence https://daorayaki.org/futarchy/

8. Futarchy: Vote Values, But Bet Beliefs https://mason.gmu.edu/~rhanson/futarchy.html