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    Tesla Board Member Kimbal Musk Says Most Daos Are Not Decentralized

    Jun 12,2022 | Chloe Lacour

    “Frankly, I think most DAOs are designed to allow founders to retain control,” he said.

    Kimbal Musk, co-founder and CEO of Big Green DAO (Christian Barrett/CoinDesk)

    Kimbal Musk, the billionaire philanthropist and brother of businessman Elon Musk, who is now an avid creator of decentralized autonomous organizations (DAOs), says most of these trustless structures are controlled by a few founding members.

    Speaking at Consensus 2022 in Austin, Texas, Musk, who last year launched Big Green DAO, a Web 3 charity focused on food justice, said his research revealed that most DAOs are not in fact designed to prevent the accumulation of power by a few members—something he has struggled to avoid.

    “Isn't that 'off-center' in the name?” Musk rhetorically asked the crowd in Austin. “How much do you have to be decentralized? I think the most important guiding light is to have systems that prevent the accumulation of power for one person. Frankly, I think most DAOs are designed to allow founders to retain control.”

    The DAO concept has seen a surge of interest along with the excitement around non-fungible tokens (NFTs) and Web 3. However, these nominally leaderless organizations and online investment collectives have been labeled as simple group chats with a bank account.

    DAOs, for Musk, must be continually decentralizing to avoid accumulating power, which is why donors and nonprofits that vote for the Big Green DAO have term limits, meaning they have to give up their seats. on the board and be nominated back to the organization on a quarterly basis. But Musk said that deadlines are something that most DAOs don't typically have.

    “I had to feel myself losing control of this beautiful thing that I spent 1,000 hours working on, and I think everyone should go through this process,” Musk said. “I think we started with six nonprofits. I saw them go through the process of giving up control.”

    In terms of progress updates, Musk said 10 new nonprofits have been hired, with 86 more of those organizations scheduled to be brought in this quarter, out of about 400 that have signed up.

    Speaking about the transparency of DAO-based philanthropy, Musk pointed out that normal charities spend 15% on their overhead before a single penny is distributed.
    “Even if we're not that good, we'll probably do a better job,” he said.

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