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Crypto ETFs: Beyond Bitcoin & Ethereum, and onto Bitcoin Forks – StableLab’s Doo Wan Nam Outlines Next Steps

Last Updated June 1, 2024 2:12 PM
Teuta Franjkovic
Last Updated June 1, 2024 2:12 PM

Key Takeaways

  • StableLab’s Doo Wan Nam said that while technology can boost efficiency, it cannot fully replace the human element essential for effective decision-making.
  • Wan Nam predicted that Litecoin or Bitcoin Cash probably would be next in line for ETF approvals.
  • He mentioned the social finance (socialfi) sector could be the next hot thing in crypto.

In a recent interview with CCN, Doo Wan Nam, the Co-Founder and COO at StableLab, shared insights into the evolving landscape of Decentralized Autonomous Organizations (DAOs), and where he sees the next ETF coming to the crypto space.

Wan Nam suggested that a Bitcoin fork could potentially be the next ETF due to its similarities with Bitcoin, making it a straightforward option for exchanges.

Litecoin, Bitcoin Cash Top Contenders for Next Crypto ETFs

Since the SEC opened the door for Bitcoin ETFs, and quickly followed that up with Ethereum ETF proposals, many questions have circled around which coin is next. Regarding what crypto would next ETF’s, and how that decision will be made, will be based on striking a balance.

“Looking at, for example, both Bitcoin and let’s say, Ethereum approved, it’s very likely the next steps probably are going to be those that have, let’s say, high volume, but at the same time has proven to be at least from the legal side of the safer as well. So although it might be unpopular, I’ll say probably like Litecoin or Bitcoin Cash probably is next in line because it has a lot of common with Bitcoin itself. Also been a long time also there’s some appetite for it,” Wan Nam said.

In discussing the strategic choices behind cryptocurrency listings on new exchanges, Wan Nam pointed out that Bitcoin and Ethereum are typically the initial choices due to their prominent status in the market.

He also mentioned other cryptocurrencies like Ripple, highlighting its potential for being featured next, although he expressed uncertainty about its specific prospects. Wan Nam speculated that it might not necessarily be Ripple; alternatives like Solana could also be candidates.

However, he suggested that a Bitcoin fork might be more likely due to its similarities with Bitcoin, making it a simpler choice for exchanges. This reflects the complex considerations involved in selecting cryptocurrencies for new trading platforms, where factors like market recognition, technological stability, and user demand play critical roles.

FTX Collapse Didn’t Deter Institutions – Crypto ETFs Gain Momentum

Wan Nam shared his thoughts on the recent developments around Ethereum and Bitcoin ETFs. He expressed surprise, not just at the approval of these ETFs but also at the rapid rate at which institutions have adopted cryptocurrency. This is particularly noteworthy given the significant downturns in crypto prices and the high-profile collapses of major entities like FTX and Celsius, which he thought might make institutions more hesitant to engage with cryptocurrency.

However, the continued interest from these institutions underscored a greater appetite for cryptocurrency involvement than previously anticipated.

Wan Nam also discussed the unique aspects of Bitcoin and Ethereum in the context of ETF approvals. He noted that Bitcoin’s appeal lies in its decentralized nature and the anonymity of its founders, which contrasts with Ethereum, which has faced criticism due to its more visible governance structure through the Ethereum Foundation.

Despite these differences and potential hurdles, the approval of Ethereum ETFs was a significant milestone. This development, according to Doo, not only demonstrated the institutional appetite for such investments but also paved the way for greater integration of cryptocurrencies into mainstream and institutional portfolios, marking a surprising and exciting advancement in the crypto landscape.

Steering DAOs with Expertise, Pushing for Fairer Governance

Wan Nam also shared with CCN his insights on the future innovations and improvements in DAO governance structures. He noted that while the blockchain industry often looks to technology to solve problems, including those related to DAO governance, there remains an essential human element that cannot be overlooked. He pointed out that despite the availability of various DAO tools and technologies that facilitate governance, the necessity for human participation—particularly in voting—persists and is often underestimated.

Doo emphasized that while technology can enhance efficiency, it cannot fully replace the human aspect required for effective decision-making.

He asserted:

“So, one of the interesting things that we see is that because there are so much things going on in DAO governance, it’s actually very difficult for most, I would say, average people who are engaging to understand fully. So, there have been a lot of combination with actually AI and governance as well, Instead of trying to read everything, what has happened? They try to summarise very simply, or we also saw a lot of the innovations to see what is happening, what are the impacts.”

These technologies help distill vast amounts of information into digestible summaries, aiding participants in understanding the implications of governance actions without needing to delve into every detail. Tools like Tally , for example, have become increasingly popular among DAOs because they simplify explanations of proposals and their impacts, making it easier for people to comprehend what they are voting on.

Uniswap DAO Power Shift – More Voice for Active Delegates

In a discussion with CCN, Wan Nam commented on the recent proposal designed to enhance voting power for underrepresented Uniswap DAO delegates, which has seen considerable support. Doo explained that the proposal was necessary due to the challenges faced by active delegates who, despite their frequent participation, lacked sufficient voting power to influence outcomes significantly. This issue was not unique to Uniswap but was prevalent across various DAOs.

Doo highlighted that the primary objective of the proposal was to ensure smoother governance operations within Uniswap and to enable the progression of popular proposals that had the backing of the community but fell short due to the high quorum requirements. Currently, the quorum for Uniswap  stands at 40 million UNI, equivalent to over $440 million, a figure beyond the reach of most participants without sufficient consolidation of voting power.

Moreover, the proposal aimed to address the lack of direct rewards for active participation by increasing the voting power of diligent delegates. This adjustment was seen as a necessary step to not only facilitate effective governance but also to motivate and retain active delegates by recognizing their contributions. This approach, according to Doo, has been well-received within the community and is being considered by other DAOs to enhance their governance frameworks.

He explained:

“Well, the point was also to reward some of those delegates who are active, because you can imagine if your active delegates were spending their own budget to vote on those proposals for quite a long time, and they’re not getting anything from the Dao, then it will eventually discourage them.”

Rewards & Clear Communication Keep Delegates Accountable

Wan Nam discussed the importance of maintaining high participation rates among delegates for accountability within DAOs. He emphasized that to ensure delegates remain active and informed, it is crucial to recognize and reward their efforts appropriately.

He drew parallels to traditional politics, where even less prominent politicians are compensated for their time spent reviewing and voting on legislation, underscoring that similar incentives should be applied in DAOs, especially those managing significant assets and facing potential governance attacks.

He recommended that delegates receive rewards to offset the costs they incur participating in on-chain governance. This compensation is vital for sustaining their long-term involvement and effectiveness. Besides financial incentives, he highlighted the importance of robust governance communication to enhance transparency and ensure that delegates are well-informed about voting schedules and proposal details.

This approach mirrors strategies used in traditional politics to inform and motivate constituents to vote, underscoring the need for DAOs to adopt similar practices to foster informed participation and enhance overall governance accountability.

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