One of my biggest critiques of the social sector is that it’s a few steps behind emerging technologies and trends.
There is a culture of reactivity baked into the fabric of the sector: a focus on trying to fix the known instead of anticipating and positioning around the emergent. Sometimes it feels like we’re obsessed about the past and missing the future.
The social sector loves to read the damning Atlantic article on all the ways the system is broken but spends less time reading the TechCrunch article on how the newest technologies might — just might — shape the future system.
We’re living in an age of technological revolution with the mainstreaming of blockchain technology, cryptocurrencies, and the decentralized web where power, ownership, and wealth-building doesn't accrue to the biggest corporations, but lies in the hands of everyday people (this decentralized web will be henceforth summarized as “Web3”).
We are in the earliest days of this transformation, which is why it’s critical that we both understand how we can leverage this technology for social change and that we infuse principles of equity, justice, and environmental impact into the early DNA of the technology and culture of the Web3 movement.
So I tried something a bit different from my normal approach by writing a white paper on the intersection of Web3 and social change.
The purpose of this white paper is to explore a few of the ways that the social sector (nonprofits, philanthropists, activists, social enterprises, impact investors, etc.) might be able to leverage Web3 technologies.
You can find it via this link or by downloading it below.
White Paper Summary
I start with the most straightforward: social sector organizations accepting crypto donations. Most nonprofits don’t have infrastructure to accept cryptocurrencies, but crypto is the fastest growing asset class in the US, and it will be strategic for nonprofits (and others) to have a crypto-giving plan.
Next, I explore digital assets (like NFTs) and ways that social sector organizations can capture and retain value by issuing and transacting digital assets. Much of this exploration is still conceptual, drawing on the ways NFTs and other digital assets are being minted and transacted. Social impact organizations struggle to capture and retain value, and the argument advanced in this section is that digital assets on blockchain represent a fundamental innovation in how value is captured and retained.
Then I explore participatory fundraising models through decentralized autonomous organizations (DAOs). There have been some stunning examples of rapid fundraising through DAOs, and while t’s still unclear how DAO-based, participatory funding campaigns can be applied to the social sector, they do represent a new era of crowdfunding.
After DAO-based fundraising, I dive into new models of organizing, ownership, and activism through DAOs and other on-chain communities. I touch on the ways that the “Crypto Bro” and the “Social Justice Warrior” are actually aligned on the values that underpin web3 technology: power and code to the people! I feature a few examples of how DAOs can be leveraged to support workers rights, to push for decarbonization, and how a community-based DAO might shift the power dynamics in philanthropy and create models of shared governance for leaderless movements.
Next, I explore how web3 technologies are democratizing wealth building and helping people build wealth through the ownership of assets. Organizations like Black Bitcoin Billionaires and others are using crypto to try to close the wealth gap in the US. In this section, I also explore ways where play-to-earn video games present income-generating opportunities for communities in the global south and how digital-first economies in the metaverse need to be designed with principles of equity.
Finally, I touch on a few other conceptual opportunities (DeFi, the economic self, and the power of pseudonymous identities), identify some cautions and concerns about the intersection of web3 and the social sector, and conclude with a list of ventures, solutions, and other things that maybe should be built in the future.
Notes + Requests
I must confess at the outset that I am neither an indoctrinated web3 optimist, nor an expert in the web3 space, nor do I wholeheartedly believe that everything I have outlined should be implemented, or even is a good idea. The purpose of this white paper is to share possible use-cases, some crazy ideas, and a few practical opportunities.
I am not here to suggest that web3 technologies should be implemented in every corner of the social sector (big questions about equity, justice, and access remain), but I am here to suggest that we should understand these new technologies and be conscious of their sweeping power and possible applications.
I am trying a new publishing approach with this white paper, and I fear that the formality and polish of the document suggest its contents and ideas are finished products. They are not. This is as much a draft and work-in-progress as anything I have written (which is why it is a v1), and as anyone knows who spends time in web3, things move quickly. If there is one thing I am confident about, it is that these ideas will be out of date as soon as they are published.
One of the best ways to learn is to be slightly wrong in public, and I hope that people will do me the favor of pointing out errors, mistakes, or opportunities that I’ve missed. I’ll make revisions along the way and give credit generously for those who take the time to make this better, more comprehensive, and more accurate.