report

Penny Rafferty

Interviewed by Inte Gloerich on 22 October 2024

Putting the Social First: Toward a Third Wave of DAOs

Penny Rafferty is a writer, critic, and visual theorist. Departing from her research and thinking, she has initiated and co-founded Black Swan, a Berlin-based collective pursuing horizontal and decentralised approaches to art-making through experimentation with the organisational form of a DAO. https://blackswan.support/. Together with Ruth Catlow, she leads the Blockchain Lab at Serpentine Galleries in London, and, in 2022, edited Radical Friends: Decentralised Autonomous Organisations and the Arts. Catlow, Ruth, and Penny Rafferty (eds). Radical Friends: Decentralised Autonomous Organisations and the Arts. Liverpool: Torque Editions, 2022. The publication gathers diverse voices at the forefront of artistic and activist DAO experimentation. In our interview, Penny discussed key parts of DAO history and argued for the establishment of what she calls a third wave of DAOs in which the needs of communities and their situated perspectives are put first. Together with others, she is developing a protocol called Syn towards this goal. Additionally, we discussed the socio-political context in which artworld DAOs emerged, such as the precarity and austerity that characterise cultural sectors. Through years of disenfranchisement, people have lost access to the practical and imaginative tools to define their own realities. Penny shows that DAOs offer a way to practice alternative organisational forms, to explore collective practices, and to world new worlds together.

The many things a DAO can be

Inte Gloerich As someone who has been thinking and working in the blockchain and DAO space myself, I often have to explain what a DAO is. This is not an easy thing, and I am curious how you go about this, for example, which metaphors you find useful.

Penny Rafferty I think a DAO, a decentralised autonomous organisation, is still being defined in terms of what it is, and that is also what drew me to them. It is a technology, a methodology, and a social, fluid structure.

I usually explain what a DAO is through a set of bullet points that go a little something like this:

And a few quotes from inspirational DAO-defining peers… R. Catlow and R. Myers in Trouillot, T. et al. ‘What Can DAOs Do For You?’ Frieze, 13 November 2022, https://www.frieze.com/article/what-can-daos-do-for-you. See for more of Kei Kreutler’s descriptions Kreutler, K. ‘Eight Qualities of Decentralised Autonomous Organisations,’ in R. Catlow and P. Rafferty (eds), Radical Friends: Decentralised Autonomous Organisations and the Arts, Liverpool: Torque Editions, 2022, pp. 94-101.

Many of those bullet points have been activated in the artworld or thought through in arts and technology settings. In part, this has to do with the emergence of new generations of art workers raised on intersectional feminist, queer, anti-capitalist, anti-racist, and anti-colonial critiques of the historical workplace they have inherited. In part, it also has to do with the need to survive in an unregulated market and a playing field in which the vast majority of workers are destined to remain precarious or pushed down by resource holders who do not see the relevance of their creative language, whether that is argued through the lens of taste or socio-political alignment. In recent years, we have seen an explosion of political and social work that is now done in the arts — I do not wholeheartedly agree this is the right place for this work to be done, but I think it had to find shelter here due to a failing social system.

In essence, there are a million reasons why the worlds of art and culture have emerged as key protagonists in the story of DAO-thinking and making. This is also where I operate within my own research. My initial steps were through a project called Black Swan, which was conceived over many years of practising in the Berlin artworld, and through a strong discursive group of peers who criticised the infrastructure we operated within.

But before we discuss the specifics of Black Swan, it is also important to mention that we are now in the second wave of DAOs. For more on the historical lineages at play in DAO culture, see Kreutler, Kei. ‘A Prehistory of DAOs: Cooperatives, Gaming Guilds, and the Networks to Come.’ Gnosis Guild, 21 July 2021, https://gnosisguild.mirror.xyz/t4F5rItMw4-mlpLZf5JQhElbDfQ2JRVKAzEpanyxW1Q. The first wave was characterised by the genesis DAO model, called The DAO. All subsequent DAOs spawned from this initial experiment, although things have not remained the same over time. The DAO was originally meant to operate as a venture capital fund for crypto. In the eyes of its founders and the groups around them, the lack of centralised authority was a way to reduce costs and provide more control and access for the investors. In essence, they created a pool of money that could fund different projects from participating parties. Within this logic, there is already an understanding that you can do more together than alone. For example, pooling resources together with others reduces your personal risk. Plus, you get to collaborate with like-minded individuals in a space where people’s dreams, purposes, and desires interact and contend with structural necessities. These are some of the core elements that second-wave DAOs experiment with, and that are visible in artworld DAOs as well.

Another important note to make is that DAOs can have many different outcomes, and they swing both ways politically, left to right, commercial to commons. This space is very complex and over the years of working with DAOs, I have found that they have as many pros as cons. For example, take the lack of centralised authority. This could mean a deregulated free market and the idealised model of an economic system without the intervention of a government or external authorities. Yet, the lack of centralised authority could also mean a grassroots, leftist community organisation that holds and distributes resources that have been pooled outside the reach of a fascist regime or in the absence of a functioning government. In both cases, blockchain ensures that a transaction will go through as long as all the set criteria are met. It is censorship-resistant in that sense. It ensures that no government or organisation can influence or alter transactions on the blockchain regardless of the amount of power they wield. This is radical for every political position.

Artworld DAOs

IG You immediately touched on many things that are so interesting. And maybe the first thing to dive deeper into is the connection between DAOs and the artworld. Artworld DAOs have a particular sort of positionality or reason to be within this socio-political history that you sketched. So what are artworld DAOs, and why is DAO experimentation important in the context of the artworld?

PR Artworld DAOs are exactly what they say they are: they are DAOs that have been manifested within the arts and technology sector or the cultural sector. What differentiates them from what usually comes out of the decentralised finance space is that, often, artworld DAOs try to bring about an environment that is conducive to placing culture before structure. They aim to implement a participatory design space, not just to perform a set of equations for voting and fund allocation, but also to perform situated research as art workers on questions regarding how work relations and funding processes in art and culture could be organised differently. This includes inquiries that span from the individual art worker or their local community to their broader networked, translocal, and international community, and it speaks to the tiered spaces of resources that come from the market, patrons, institutions, etc. The terms and conditions of artworld DAOs reflect and feed into a lot of the cultural decision-making in this complex space.

Together with Ruth Catlow, I have been addressing similar questions at the Blockchain Lab of the Serpentine Galleries in London. Specifically, we are interested in understanding what the praxis of radical friends would be in terms of artworld DAOs. In my view, the technology is still not there to create a minimum viable living agenda for all the members connected to a DAO.

IG Why is that? What are you still missing, what is still up for further negotiation or experimentation?

PR Access to code is one crucial aspect. If you do not have access to code and coding skills, you can use a template with a set of rules that is already in place, or else you need the amount of wealth necessary to pay somebody to program, maintain, and upgrade a bespoke DAO continually. These participation conditions are why it is so difficult for people to get their hands on DAO technology and to begin to see how and for whom it works.

Tensions between DAOs and their socio-political contexts

IG What you are pointing to, I think, is the wider context of a socio-political reality that structures so much in life and then DAOs as an opportunity to create some cracks or to design something else, even if just temporarily. The tension between the conditions that are not easy to change or even capable of being changed from the bottom up and the potential for some sort of imaginative or prefigurative moment, a place to practice difference.

PR Yeah, definitely. It is important for people working with DAOs to recognise this particular moment in time as well. When Radical Friends came out, the world was a very different place. In a certain sense, the artworld missed the moment to broker, invest, test, and distribute this technology for now. 2023 was the last moment when we could really have the energy to sit with these technologies — since then, so many urgencies have called our attention that there was no time left to tinker with a nascent technology. On top of that, budget cuts have created deficits that make it increasingly difficult to even begin to onboard people.

The arts sector has increasingly mobilised itself in recent years. There have been boycotts and protests not only regarding funding sources and working conditions but also concerning broader socio-political narratives. We need to recognise more broadly in all civic sectors that these global narratives are shifting alarmingly toward the right. Even when we do not have a far-right government in power — half the voters think we should — this is not a win, it is a divided community.

This shift not only leads to cuts in governmental funding for the arts but also structurally deteriorates the world — more than just art is at stake here, and cultural workers seem to understand this very well. Just yesterday, there was a strike in Berlin due to these funding cuts, and it has become almost a weekly occurrence across different sectors. There have been numerous cuts and instances of censorship; people have even lost their awards and jobs here in Germany because of petitions they have signed in support of Gaza. Brown. Rivkah. ‘Germany Ties Cultural Funding to Israel Allegiance.’ Novara Media, 7 November 2024, https://novaramedia.com/2024/11/07/germany-ties-cultural-funding-to-israel-allegiance/. This continual move to the right has fostered greater scarcity, precarity, and biased behavior, making the arts in many countries around the world extremely vulnerable to censorship both in public and private.

Currently, the only business model that appears to have survived these cuts is the market model, which shows little interest in the radical care and innovative work that was previously emerging in the art world. Right now, people lack the energy and time to conceptualise new systems for community organizing and participatory practices with civic goals. They are too busy fighting for the little that remains. Artists, I believe, desire to work within a different framework in which their own protocols and autonomy remain intact. They reject austerity policies and censorship. However, it is challenging to continue to have faith that such futures can materialise. That said, I consider myself an optimist. I firmly believe that the pushback we see today is a sign that the progressive left is gaining traction. We find ourselves in literal and cultural war zones, underscoring the critical need to prioritize social concerns. It is essential to focus not only on tools but also on laws, civics, and ethics.

IG The way you oscillate between critique and optimism connects with my own trajectory as well. A lot of my research is on the more mainstream blockchain applications and narratives, and I write critically about many things that are happening there. I spent years diving into them and it is easy to get jaded. But taking the time to look into the artworld DAO scene gave me hope. Occupying the space between knowing that things are very bad and, at the same time, also finding moments to connect and do things together is really important.

PR And it is so important to take time to delve into that mainstream space as well. When I first came into contact with DAOs and blockchain, they were considered a fringe, weird, cryptic, outlier space. Many people I spoke to over those initial years did not believe that this space would ever create structural change in society. It is a continual problem that we do not give ourselves the time and space to be involved in these emergent conversations as they are happening. It is so critically important to involve oneself in these uncomfortable moments when technologies are developing and failing.

I recently read Naomi Klein’s new book, Doppelganger, in which she uses the term shadowlands to refer to those parts of our personal and collective selves that operate and profit outside of full view. Klein, Naomi. Doppelganger: A Trip into the Mirror World. New York: Farrar, Straus and Giroux, 2023. I do not mean to say that we work in the shadowlands, but many crypto, blockchain, and DAO models are developed in a particular shadow of everyday infrastructures. However, what is in the shadows is not necessarily less powerful than an already existing civic governance infrastructure, especially at a moment when faith in those traditional structures is waning, and it becomes increasingly clear that they can be influenced based on the whims and desires of the powerful. Simultaneously, it is clear how inspiring these new technologies can be to those in power. Take for example the Russian government, which is exploring the idea of a digital ruble — a central bank digital currency (CBDC). Such a currency is distinct from cryptocurrencies like Bitcoin and Ethereum because its control and infrastructures are centralised. The digital ruble is designed to be a state-backed electronic money, issued and managed by the Russian Central Bank.

The future of DAOs

IG What is your vision for the future of DAOs? Are they tactical, momentary, small spaces that are situated and that allow people to practice different ways of being but only last for however long they last, or are they tools for working on infrastructural and broader societal changes?

PR This is a good question that me and Ruth have been battling with since publishing Radical Friends — what is our hope for DAOs? — and some months feel more fruitful than others. Together, we have been developing a protocol or a process called Syn, which, in a sense, encapsulates our hope for what DAOs will become. We hope that a kind of third wave of decentralised autonomous organisation can be created that has a ‘social first’ focus within the process of tool development. A new type of DAO that explicitly serves and respects the needs of physical spaces and communities as they are situated in a particular place. In a sense, we are starting to imagine DAOs as techno-social tooling. With Syn, we are working on a methodology borrowed and remixed from artist collective Omsk Social Club called Real Game Play Omsk Social Club presentation about Real Game Play at The Influencers festival 2018: https://www.cccb.org/en/activities/file/the-influencers-2018/229575. to test and accelerate the potential of alternative cycles of engagement with DAO principles.

Through Real Game Play, we endeavour to test a new translocal, interdependent model of art-making. Our goal is to create greater autonomy in cultural decision-making and to generate livelihoods for practitioners. Instead of focusing solely on visual commodities within the realm of visual art, we seek to develop experimental social care, encourage radical dialogues, and establish interdisciplinary infrastructures and governance models. We believe the artworld is an ideal environment to explore these ideas with diverse audiences that challenge norms, ask difficult questions, and provide meaningful critiques. Ultimately, the objective is to create models that transcend the boundaries of the artworld and extend into civic and community spaces more broadly. In this context, Syn serves as a handbook or playbook that has a social component: it aims to establish a minimum viable living agenda for all its members. It acts as a guide for bringing together communities and addressing their challenges. It is a callback to the concept of Radical Friends and serves as a proposition for future collaboration.

World-making stories

IG I have heard members of Black Swan describe its processes as “blockchain thinking without the technology” or paper prototyping a DAO. See e.g., Black Swan. ‘CTM 2022: Prototyping Sonic Institutions.’ YouTube video. 30 January 2022, https://youtu.be/DKb9za47twU?t=685. Is Syn also like that? Trying to think through the logics of the technology without actually building the technical systems themselves?

PR Black Swan had to take a paper prototyping approach very early on because of the way Black Swan was initially incubated through Kunst-Werke, which is an Institute for Contemporary Art here in Berlin. Rafferty, Penny. ‘A Speculative White Paper on the Aesthetics of a Black Swan World.’ REALTY, Berlin: KW Institute for Contemporary Art, 2018, https://www.kw-berlin.de/files/REALTY_Penny_Rafferty_EN.pdf. In 2018, they commissioned me to write a proposition of how resources could be distributed to art workers in a different way from how they have always been distributed. They offered the medium of an essay for this proposition, and so, rather than programming a DAO or roleplaying its method, this was the medium through which I wrote Black Swan DAO.

To a certain extent, paper prototyping is about arguing that you can think through the processes of these new and emerging technologies like DAOs without necessarily using the technology. It is about play: is the way that a child plays and uses a children’s kitchen unit to fry eggs, chop vegetables, etc. any less authentic to the experiences of an adult in front of an oven frying an egg? Yes, the materiality is different, but they learn similar skills and reflections. And what myself and Ruth have tried to broker is that with DAOs you do not have to have access to the black box to begin to think through the technology’s logics.

IG How do play and practices like Live Action Role Playing (LARPing) and storytelling connect to DAOS and the reimagination of what the social realities around us could be like?

PR They relate to how disenfranchised people often use folklore as a medium to archive their own political, personal stories as manifestations for their future generations. Having grown up in the UK during and after the Thatcher government shapes my view on this. This government continually disenfranchised people, particularly working-class people, and white and Black migrant communities. It continually told them that they could not believe, could not envisage, could not tell other stories. At the end of the day, reality is a story that is told to us. Reality is a position that we inherit, it is a position that is written and upheld by authorities who then also remove from marginalised communities the tools to write their own realities. They squeeze out the time, energy, and desire it takes to get involved in writing reality. For me, what makes DAOs exciting tools for worlding practices is that a DAO is like a micro-society where governance structures and social structures are lore. DAOs allow people in closed, private spaces to determine their wants and desires and to recognise in an accelerated way what their decisions do and create.

This is something that is often missing in larger society. Take, for example, the Brexit referendum, which was the result of a governance structure that created a moment in which the whole of society could vote on a world-changing narrative. This narrative took years and years to take shape, but it all culminated in this one vote. Now that I think of it, maybe the Brexit referendum is a good metaphor for voting in DAOs as you asked me at the beginning of this interview. During the run-up to the referendum, you saw people who had social or cultural clout that would weigh in and try to sway the vote. The referendum was not just about a topic on an agenda that people voted for. There were all these subsequent forces that were trying to play the game, play the model, break it, and push it into a different direction. It became a hyperobject at a certain moment, so big that it is never visible in its entirety and takes on its own agenda. For more on hyperobjects, see Morton, Timothy. Hyperobjects: Philosophy and Ecology after the End of the World, Minneapolis: University of Minnesota Press, 2013.

IG Brexit as a metaphor for DAO voting! It has all the elements like the world-building narratives, the governance structures, the social moment of the vote…

PR Yeah, and with DAO voting, you fill in about 20 characters of text, but everyone reading those 20 characters imagines a different ‘Brexit’ based on that.

To zoom out a bit, I think these are all skills that we have to learn regarding participatory design and alternate reality games. Even people with the best intentions can mess up entirely surrounding a proposition — not that Brexit falls into this category. Conversely, a terrible idea can also come up against such forceful pressure that it has to remodel itself to become more ethical, for example. By putting these things into the decision-making agenda of a DAO, and going through cycles of feedback, the moments when reality is being made collectively become more tangible.

Black Swan DAO as a travelling framework

IG Could you take me into the reality of Black Swan? What is it like to participate in this DAO?

PR Well, Black Swan officially ended in 2023. I think the next moment of Black Swan would have been to commit to code instead of remaining a purely speculative design model, but unfortunately, the economic footholds to be able to do that fell away.

IG In terms of financing projects, where did value come from in Black Swan when it was still running?

PR Every project was commissioned by a cultural institution. Each artwork was basically a module with its own budget and with specific people working on it. I was there from the beginning to the end, but other people stuck around for a couple of years and moved on. I am still working with several people, like Laura Lotti and Cem Dagdelen, who also play a big role in Syn, and many other people who I met along the journey.

What Black Swan managed to do over the years was to make apparent the many things a DAO could be, like the list of bullet points I shared at the beginning. At some point, these visions of what Black Swan could be started to diverge between the main stewards of the project. I can only speak to my perspective, of course. What I was interested in with Black Swan was understanding whether a DAO could really be a fully decentralised and autonomous organisation. I was interested in creating a horizontal organisation where authority and leadership could be continually dissolved and reinstated. My central question was: would it be possible for Black Swan to be entirely passed over to another community — to remove the generational hierarchy between projects? Or would it always need to be maintained and held by one of those original core stewards?

IG So as a sort of framework that could work in different contexts?

PR Yeah, exactly.

I cut my teeth within political cooperatives, solidarity groups, and so forth. So I was very aware of of particular players holding power and of power hierarchies existing, even if such a power hierarchy is given shape as part of a cooperative spirit. So the question is, can such a powerful player remove itself and can the community maintain its robust manifesto, its ethics, its drive, its network? I have always been fascinated with the communal experience in relation to charismatic leadership. Can charismatic leadership be dissolved into a shared community ideology, or does it always have to be held and maintained by a charismatic leader, even if that leader is acting in support of the community?

IG So within your vision for Black Swan — in which it would travel to other communities — how would it deal with the potential that these communities have other needs or other value systems? Would certain values remain stable or could they change for each community?

PR For me the love of DAOs, the love of chaos, the love of change, is that they should be mutable, not just to different communities, but also over time. For more on Penny’s thoughts on chaos and mutability in relation to DAOs, see Rafferty, Penny. ‘The Reappropriation of Life and the Living — A Cosmic Battleground,’ in Radical Friends: Decentralised Autonomous Organisations and the Arts, Liverpool: Torque Editions, 2022, pp. 102-114. Different times need different forms of energy put into the community. There are moments where you can draw back and begin to tinker with the spreadsheet of community organisation, and then there are moments where you have to be on the street, with a sign of what that community means, expects, and demands.

What Black Swan taught me towards that end is my own mortality as a community actor. It became very apparent to me that I was in the wrong room. And sometimes, one does not have the energy to redecorate that room. Because other people also make decisions about the interior. There is a limit to the amount of time, energy, and hope you can put into it. You have to let it go sometimes, and that ages you because you see something being born and die. But then you also get to make the journey to other rooms.

Mutability and immutability

IG I always find it interesting to hear the word mutable being applied to DAOs. On the one hand, I completely understand why it is used in the context of community processes that are always changing and need to stay flexible, but on the other hand, blockchain itself is often talked about as immutable. That is an interesting tension. What is it about DAOs that makes you use the word ‘mutability’ specifically?

PR Yes, there is this seeming contradiction between blockchain and DAOs in terms of immutability and mutability. I would like to address this in relation to people’s participation in communities. There are certain things that you are mutable about, but then there are also certain things that are immutable in your very core. Blockchain is the immutable part of you that you will not change regardless of what is happening around you. This part contains your beliefs, your very essence. No matter what is politically, economically, or socially happening around you, you will not stop the transactions of your beliefs. The mutable part is the part that you can change based on what is happening around you. For example, I think it is really important to celebrate when people change their minds. We tend to think about that in terms of winning and losing. If you change somebody’s mind, it is considered a win. But actually, if you change somebody’s mind, you have opened up their horizon, and they have allowed you to do so. It is vulnerability, it is extremely brave, it is welcoming. And for me, that is why DAOs are mutable. You can set off in one course of action, and through material and social developments, that course of action can change. It can turn into a forked course of action, or it can strengthen and gain complexity, or it can turn into an exit or ending — which is what happened in the case of Black Swan — all of which are important chapters.

IG Socially, there is such a need to allow ourselves to be mutable, to welcome mutability. This was one of the themes that is addressed in Radical Friends that gave me hope. That we can try and we can try together. We can learn and get somewhere together. Maybe it is not where we intended to go, but it is a process, it is change, and it keeps going and bringing us to new places.

I see that we’re almost at the end of our time, and I wanted to ask if there is anything that you wanted to add before we wrap up.

PR I am thinking of this quote from The Invisible Committee’s book called Now. Perhaps The Invisible Committee would think it is almost a bastardisation to use it in the context of DAOs, but it speaks to being present with others at a particular moment and a particular place. For instance, when you are in a protest and you look to the person to your left and the person to your right, you recognise the shared company you are in. There is something that occurs in your body and in your mind and you feel fulfilled and vulnerable — a kind of vulnerability that can rely on the understanding of a shared belief. So this is where I strive to find myself at the moment. A translocal emotional space that is also place-based and community-based — my hope is it will be found in the third wave of DAOs.

“The organized riot is capable of producing what this society cannot create: lively and irreversible bonds. Those who dwell on images of violence miss everything that’s involved in the fact of taking the risk together of breaking, of tagging, of confronting the cops. One never comes out of one’s first riot unchanged. It’s this positivity of the riot that the spectators prefer not to see and that frightens them more deeply than the damage, the charges and counter-charges. In the riot there is a production and affirmation of friendships, a focused configuration of the world, clear possibilities of action, means close at hand. The situation has a form and one can move within it.” The Invisible Committee. 2017. Now. Cambridge, MA: MIT Press. p. 14.