The New Order Decentralized Autonomous Organization (DAO) is a community-driven incubator that seeks to improve the state of Decentralized Finance (DeFi) projects by providing access to building resources. At its current state, the DeFi ecosystem faces a significant challenge when it comes to matching innovators, investors and prospective communities.
New Order DAO was formed with the primary goal of leveraging the coordinated efforts of a DAO model to introduce a self-governing DeFi incubator. At the core, this DAO ecosystem allows community members to exercise their voting power in choosing which DeFi projects to support. The selection criteria focuses on DeFi innovations that are building on Web 3, interoperable multi-chain solutions and those introducing a new asset class.
With barely a year in existence, the New Order DAO has already raised $4 million from notable investors, including LedgerPrime, Digital Finance Group, Outlier Ventures and Near Foundation. The venture DAO was co-founded by Eden Dhaliwal, previously the Head of Crypto-Economics at Outlier Ventures between 2017 and 2020. However, New Order DAO is set to transform into a fully decentralized DeFi incubator upon the token generation event (TGE) of its native governance token, $NEWO.
A Decentralized YCombinator for DeFi Projects
Similar to the YCombinator traditional VC model, New Order DAO seeks to propel early-stage DeFi innovations from the idea concept to market adoption. The DAO plans to accomplish this goal through strategic incubation and acceleration while routing the token allocation from the funded DeFi projects back to the DAO’s treasury. Some of these proceeds will be managed through various DeFi yielding strategies to further maximize the DAO’s returns.
As for the funding recipients, New Order DAO proposes a significant value proposition. The DAO not only allocates funding, but also provides other building resources, including product advisory and community growth hacking. Ideally, this DAO will assist DeFi projects on technical issues such as token engineering, security assessments, legal issues and product feedback from community members and industry leaders.
According to the project’s introductory blog, New Order DAO will operate as a multi-protocol ecosystem which means the funding allocation will cut across DeFi projects built on various blockchain protocols,
“We’ve created an incubator for everyone in DeFi, allowing permissionless entry for anyone in the community to allocate our multi-chain balance sheet to the project or opportunity that best serves the DAO and ecosystem’s needs long term.” reads the blog.
How the New Order DAO Ecosystem Works
The New Order DAO model is built on a two-tier approach, featuring community members and ecosystem system partners. At its core, the DAO will be governed through the native $NEWO token which is designed as a multi-chain governance token. This token will be used to power on-chain functions such as issuing community rewards and the initiation of governance and DeFi funding proposals.
Proposals on New Order DAO
Unlike centralized VCs which have limited participation, New Order DAO allows anyone to become a member of the DAO by holding the $NEWO governance token. The token, which is yet to be distributed, will be allocated through a combination of different approaches; liquidity mining incentives, contributor rewards, community drops and the Sushi Miso LBP.
With $NEWO, community members will be able to introduce and vote on proposals that shape the future of the DAO. On the other hand, DeFi teams will also be able to initiate proposals, enabling them to seek seed funding for their innovations.
Coming down to the proposal process, New Order DAO has made it pretty seamless for all stakeholders. For starters, DeFi teams will have an opportunity to create the templates and voting parameters. The proposals will then go to the submission and voting stages, respectively. Accepted proposals will be enacted by the New Order DAO community in collaboration with ecosystem partners and the grant recipients.
Notably, this DAO incubator will also feature contributor incentives for active community members. The contributor tokens will be non-fungible and non-transferable, however, they will have a form of social capital within the New Order DAO ecosystem. Community members who receive these tokens can access privileges such as amplified voting power and early exposure to incubated DeFi projects.
Revenue Generating Model
As mentioned earlier, the New Order DAO expects to generate revenue from two sources; treasury management and project incubation.
Community members will have the opportunity to vote on proposals that focus on yield farming strategies. Some of the factors to be considered include the selection of liquidity pools and asset allocation from the DAO’s treasury. The treasury will receive a portion of the fees generated through interaction with multiple liquidity pools.
On project incubation, New Order DAO expects to receive proposals from DeFi innovations that show the potential of scaling into viable projects. The community will then allocate funds depending on the voting outcomes. Additionally, they will have an opportunity to participate in the governance of incubated DeFi projects through ‘proxy voting’.
So, what sets aside this DAO from similar initiatives? One of the features is the DAO’s prospective computer-aided governance. New Order DAO plans on integrating advanced technologies such as machine learning and data-driven innovation to assist the community in the decision-making process.
New Order’s Pioneer DeFi Incubatees
With the New Order DAO set to launch its DeFi incubator program, three decentralized applications (DApps) have been selected; OptyFi, H20 and Redacted. The OptyFi protocol is a DeFi yield aggregator that allows prospects to maximize returns by accessing hundreds of liquidity pools across various blockchain ecosystems.
Meanwhile, H20 is a co-incubation project in collaboration with Reflexer Labs and Ocean Protocol. This innovation is designed as data-collateralized stablecoin powering operations in Ocean’s data marketplaces. Last but not least, Redacted is the money lego of the Curve Finance protocol, allowing users to access interest-bearing loans against stablecoin LP token collaterals.
The New Order DAO is a first of its kind VC for DeFi innovations. This DAO governed ecosystem will set the stage for a new era where innovators don’t have to go through centralized funding sources to access capital.
While the idea may take some time before it becomes a global concept, cryptocurrencies have previously shown the potential of decentralized ecosystems in changing the nature of today’s financial markets. This will likely be the case for VC funding as well.
Ernest Hamilton, Tech Times