The Future of Work - The Daily Gwei #275

Working for the open internet will be normal in a few years.

DeFi on Ethereum has many advantages over its traditional/centralized counterparts but one less-talked about advantage is that it greatly flattens the cost of offering financial products and services to users. As you can see below, Yearn’s revenue per team member is absolutely insane because they only have 21 team members managing their billion dollar protocol whereas their competitors have many more.

Yearn isn’t the only example of this - most DeFi projects in Ethereum have very few team members with the likes of Uniswap, Compound, Curve, SushiSwap and more having 30 core team members or less (last time I checked). Let’s compare Uniswap Labs to Coinbase - the former has 30 team members or less and the latter employs 1,000+ people but Uniswap’s trading volumes are very competitive with Coinbases. Though we can take this even further and note that Uniswap is basically “done” once the smart contracts are deployed - v2 still exists and is used regularly and v3 is gaining adoption at a very nice rate - this all happens without any stewardship or intervention from Uniswap Labs.

Of course, these days many DeFi protocols are managed by a DAO and a set of token holders, but the “core” members of these DAOs usually do most of the heavy lifting and there’s not many of them. So DAOs are still much more efficient than a standard company or enterprise (while also having numerous other advantages). My favorite advantage of DAOs over traditional organizations is that they are extremely merit-based and many of them consist of anonymous or pseudonymous members/contributors. Basically, if you can prove to the community and token holders that you can do the work and bring value to the project, the DAO is happy to pay you for your services (which can be either transient or permanent).

There are also other ways that the Ethereum ecosystem is flattening the cost of work and adding efficiency to the ecosystem. Gitcoin is the perfect example here with the numerous products they offer to people who want to work for the “open internet” including grants and bounties which both help to get money into the hands of generally underfunded projects and individuals. On top of this, the Gitcoin ecosystem runs hackathons for developers, a web3-native accelerator called ‘Kernel’ for projects and other various products (with more coming soon).

I believe DAO-like models are the future of work and I think that in just a couple of short decades we’ll look back on centralized & monolithic financial organizations and scoff at them for even existing. Just as software ate and disrupted many traditional businesses, so too will DeFi greatly disrupt the financial services and banking industries - for the first time in 150 years.

Have a great day everyone,
Anthony Sassano

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All information presented above is for educational purposes only and should not be taken as investment advice.