Compare this to a traditional investment fund where you hand over your money to a private organization with opaque investment strategies, business operations, and technology. If I invest in a Vanguard or Fidelity fund, they only report back what is required of them by regulators. They take little to no input from investors, and may be running their business on decades old technology filled with flaws and bugs.
I view the DAO as an open source investment fund in the same spirit as "The Cathedral and The Bazaar". It's not perfect, it's messy, some people are more influential than others, there's a lot of noise, and it could collapse on itself at any time. But everyone gets to participate (for better or worse). Lots of eyeballs are constantly watching, and plenty of concerns will be voiced.
I know the HN crowd is a skeptical one, but try to keep an open mind. This could grow into something great. And if it doesn't... hey, it's not your money, so don't sweat it.
They may lose money, they may make some. But it's a grand experiment of a kind that's never been tried before and I'm curious to see the results.
So no disclosure laws necessary!
And honestly nobody in the international community cares about other country's securities laws. You can copy and paste some small exemption text from bank's private placements, so something for the UK, Hong Kong, Japan to make it also exempt.
The DAO itself relies on sanctioning from Switzerland just like Ethereum, so I'd say all the bases are covered, until it gets challenged.
But individual liability for all parties is pretty mitigated from the threat of securities regulators.
If it turns out bad I loose a tiny bit of money and we all have learnt something.
If it turns out good - awesome, curious to learn from it and see how it develops.
PS: At least I can tell my grand-children to have participated at the biggest crowd-funding event so far ;)
The locks or the company does zero marketing?
Also, I went to their page:
First thought: "OMG this looks like just another bullshit startup". Pages looking like that are a pretty reliable signal of very low value to presentation ratio...
It looks like you get less regulartion and legal weight if things go wrong...am I missing something?
If you understand how Wall St. works then the question becomes 'why does anyone use regular funds'.
For instance, you are already scared and don't want to deal with this anymore, you can just take all the ETH that you put into this and forget the whole thing happened.
However, there are some issues with timing, and other attack vectors/flaws in this mechanism outlined in the research being referred to in the article.
Here's the original research paper. It's a very good read: https://docs.google.com/document/d/10kTyCmGPhvZy94F7VWyS-dQ4...
Sorry, but I had to stop reading there. The sentences do not logically follow each other. The other words used by the author are not equivalent to what Sure was quoted as saying. In fact, the author's assertion removes all autonomy from a token holder and reduces them to a revenue maximizing rubber stamp.
Edit: if you can't deal (or even read), pls downmod
Put another way, the stock market rewards passive investors with exactly the same rewards as active investors (which has its own problems - shareholder control over management is notoriously lax), but the DAO goes to the opposite extreme.
I personally think that calling for a moratorium is presumptuous - I'm certainly glad there was no moratorium of the stock market when it was introduced because some economists identified some real flaws. But it is a well researched critique.
Transcript: http://pastebin.com/raw/ATJSADgr
One could argue that the thread consists of nothing but trolling, and that no one could possibly be so stupid as to invest their entire life savings, take out loans, and attempt to use credit cards to buy coins. Unfortunately, I've seen it happen.
The conversations on that thread are almost exactly the same as they were several years ago. "Hold. Things will get better, you simply must hold." "But I lost half my life savings..."
The general consensus among the developers was that the DAO isn't ready for a real business, and any business owner intending to use the DAO would face real potential risks for loss of funds or worse.
Still, it's a really interesting idea. Wish it was ready for prime-time.
That being said I think ethereum is very interesting but enormously risky (even more so than some other crypto-currencies). I think experiments like this are fantastic, but starting with 150 million is not. It would be much better in my opinion if it started with 1000 dollars and tried to grow from there gradually.
As far as incentives go, 150 million is a huge incentive to play fast, loose, and dirty by any means necessary to get balance into keys you control and cash out. From what I've seen of kickstarter, the internet is WAY less skeptical than they should be and it seems everyone needs to learn the lessons of their grandparents on how not to lose money to false promises.
As a result those equity owners could be on the hook for claims and judgments against the DAO for sums in excess of the value of the Ether they've paid in or the tokens they've received.
Uh oh.
