Japan DAO Ecosystem: Preference for Entities, Grand Vision, Thriving Rise

Recently, I went to Tokyo to investigate the local DAO ecosystem. In a co-working space near Shibuya aimed at crypto practitioners, I had the opportunity to closely observe the working environment of Japanese DAO and Web3 entrepreneurs.

This office space has a prime location, close to Shibuya Station, yet it is tranquil amidst the hustle and bustle. It occupies the 4th floor of a building, with two floors used by an active cryptocurrency investment firm and several larger affiliated teams, while the other two floors are rented by individuals or small startup teams.

The office environment is simple and unadorned, even somewhat rudimentary. However, the rent is very affordable, with workstations costing 2200 yuan per month and independent cubicles at 3500 yuan. There is also a 550 yuan evening usage package, suitable for those engaging in side jobs or participating in a DAO after work. The daily rental for temporary use is only 100 yuan.

The office facilities are simple, but the atmosphere is relaxed and comfortable. It is worth mentioning that the sound insulation effect is almost zero, and all calls and meetings are conducted "openly," which aligns with the open spirit of the DAO.

A photo wall caught my attention, with many members leaving their Polaroid portraits on it, adding a sense of community. The operating party also provides support such as a company registered address for tenants, which is quite friendly to entrepreneurs.

Every Monday, events are held here, and the invited guests often come from different DAOs. Although Tokyo has many crypto-themed office spaces, those that are so closely integrated with the DAO ecosystem are truly unique. Its operational model also features distinct DAO characteristics: members receive NFTs linked to the access control system and can unlock doors through a dedicated app. Interactions among members, as well as with the operators, are active, allowing spontaneous organization of events and suggestions. Some decisions are even determined through voting. Although it is essentially a rental project operated by a company, these community elements add a unique charm to it.

In Japan, many global DAOs have local participants, such as BanklessJP and PNouns. The Bright Moments DAO, known for its offline art exhibitions, even chose Tokyo as its Asian location and successfully held its opening event in May.

However, I am more interested in the DAOs nurtured in Japan. These DAOs give the overall impression of "social activists", as they almost all point to a common grand goal - social impact. Possibly influenced by Japan's relatively closed environment, some DAOs are dedicated to promoting exchanges and cooperation between Japan and the international community. More DAOs focus on internal development, hoping to drive progress and transformation from villages to industries, and even at the national level through community collaboration.

The Yamaguchi DAO is a well-known case in Japan. Yamaguchi is a small village in central northern Japan that was severely impacted by an earthquake, with its population shrinking from 2,200 to 800. To address the population decline and economic recession, villagers launched a digital villager NFT project in December 2021, inviting digital villagers to participate in the reconstruction of the village. This unique narrative attracted widespread attention during the NFT bull market at the time, with NFTs selling out quickly, and the initiators were even invited to speak at the Japanese National Diet.

Despite the challenges in operations, the team proposed a new development direction during the review at the end of 2022. They plan to promote the concept of digital villagers to more regions to create network effects, while optimizing the DAO operational structure.

Similar is the "Beautiful Countryside DAO", initiated by a non-profit organization established for 17 years, aimed at connecting beautiful countryside and digital villagers, creating a co-creation platform for regional revitalization. Currently, 71 villages have joined the alliance.

The industry DAOs in Japan are more moderate, primarily based on specific industries, promoting communication and mutual assistance, and may develop professional service businesses in the future. For example, a logistics DAO is dedicated to raising B-end awareness of logistics and reflecting the value of logistics; a beauty DAO aims to "create new value" and "enhance the social status of practitioners."

More ambitious DAOs even set their sights on influencing national policies. RulemakerDAO is one such representative, actively promoting the establishment of a digital nomad visa policy. From the project's establishment in March, to multiple meetings with government officials for discussions, and participation in government committee meetings, RulemakerDAO has demonstrated the potential of DAOs in advancing national affairs in just a few months.

The Japanese government is also responding actively. The ruling party, the Liberal Democratic Party, mentioned new tax schemes for LLC-type DAOs and legislation for investment-type DAOs in the Web3 white paper released in April this year.

The exploration of these social DAOs demonstrates that community concepts are influencing a broader group. They are not only reshaping collaboration and governance models but also heralding the important role of communities in the future development of society.

Although the DAO ecosystem in Japan is still in its infancy, many existing DAOs may struggle to sustain themselves, but they have sown the seeds of change in the hearts of the business community, political circles, and even the general public in Japan. These emerging forces are expected to lead the integration of innovation and tradition in conservative Japanese society.