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The DAO of Pooh

An exploration into the latest B.S. post-crypto fiscal fantasy as investors embrace the economy’s late-stage-Covid consensual hallucination.

You’d have to be living on Mars with Elon Musk not to have realized by now that most asset prices are historically overpriced: In addition to Tesla (worth more than $1 trillion even though it makes most of its profits from selling carbon credits, not electric cars), there are the famous meme stocks, such as GameStop, AMC and Hertz; there’s the publicly traded New Jersey deli (until very recently valued at more than $100 million; now still valued at a head-scratching $77 million); and of course Bitcoin, with a total value of more than $900 billion. That’s to say nothing of the many cryptocurrencies you’ve never heard of—Monero, anyone? Meanwhile, an NFT sold recently for more than $90 million and a ranch in Montana sold for $200 million to Rupert Murdoch, who is 90 years old. You get the idea.

Now, we may have reached the apex, leading some to wonder whether we have truly entered a collective late-Covid consensual tulip-craze. Enter: Olympus DAO, the progenitor of a crypto token that appeared on the market earlier this year and that bills itself as the world’s “decentralized reserve currency.” Olympus DAO currently claims to have a market value of around $2.7 billion, and has quickly become the vanguard of our WTF, YOLO, FOMO economy. “Yes, it’s a Ponzi scheme,” wrote Andrew Thurman recently on Coindesk.com, before hastening to add: “But who cares? So are the dollars in your pocket.” 

In other words, according to the broad theory underpinning the rise of alternative currencies, fiat currencies are nothing more than a confidence game and central banks are inflating them like crazy, reducing their collective purchasing power, while our faith in institutions is waning rapidly. So, you know, the usual nonsense. “Both parties believe the other to be naive,” Thurman continued, “and watching each chide the other as callow is one of Crypto Twitter’s chief pleasures.”

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A “DAO,” for the uninitiated, is a “decentralized autonomous organization,” with no central authority—unlike say JPMorgan Chase, where Jamie Dimon reigns—with decisions ostensibly made by the crowd and then memorialized on “the blockchain,” a digital public ledger maintained by its many users. For instance, the recently failed effort by a bunch of crypto fans to buy one of the original 13 copies of the U.S. Constitution, was a DAO. (Hedge fund billionaire Ken Griffin won the auction, paying $43.2 million, more than the $40 million the DAO crowd raised.) Another DAO, Krause House—named after the late Chicago Bulls general manager Jerry Krause, whose oversized ego led to the disassembling of the great Jordan-Pippen-Jackson dynasty—is trying to buy an NBA franchise. (It has a long way to go.) 

In somewhat of a contradiction, though, the Olympus DAO does have “Zeus,” a pseudonymous moderator of an online forum who makes all sorts of Olympus DAO pronouncements and rulings...

FOUR STORIES WE'RE TALKING ABOUT