Innovative health-centric DAOs at the formative stages
Recently most countries are exploring the process of decentralising health care delivery and developing DAOs.
Decentralisation is usually implemented to give more responsibility to the local community so that there is a vested interest in the delivery of healthcare. Efficiency in service delivery is considered very important to patients. There needs to be a balance to fulfil patients’ requirements and manage resource disribution.
In a series of interviews. Med-Tech News explores the development of healthcare DAOs. Dr Jane Thomason explains why health-centric DAOs are still at their formative stages.
LH: I would like to start by having your views on the potential of healthcare DAOs. What impact have them made so far in the medical sector?
Dr Jane Thomason: Healthcare-centric DAOs are mainly at the formative stages, so success metrics are inconclusive, but their focus and potential are good and exciting – as well as possibly game- changing. I would refer to GenomesDAO, a biotech DAO focused on safe, private and auditable monetization of genomic data using DeFi and Vibe Bio DAO, which aims to empower researchers and patient communities to develop medicines and technologies by changing the incentive structure.
They would attract, for example, patients and families directly affected by rare diseases into the drug funding and research process.
LH: How can decentralised healthcare be enhanced to improve the service for all stakeholders?
Dr Jane Thomason: Very recently, the healthcare blockchain technology platform Solve.Care announced the launch of Definitize, the world’s first Decentralized Autonomous Organization (DAO) for healthcare financing. Definitize is designed to improve access to care, enhancing healthcare outcomes by better-serving patients, doctors and care organizations. It utilizes decentralized finance to democratize healthcare by having the community select and finance deserving projects that create value for communities and generate sustainable returns in a highly transparent manner.
LH: What are the advantages of DAOs in relation to funding early-stage medical research?
Dr Jane Thomason: BioDAO was set up to become a permanent industry standard for funding early-stage biotech research and drug development projects. The DAO aims to fill in significant gaps in funding going to early-stage research. In addition, it provides funding democratically; it mainly seeks to avoid the bias of legacy investors towards celebrity labs and serial biotech founders.
LH: What is your direct involvement, if any, with DAOs within the global health tech sector?
Dr Jane Thomason: My involvement for the purpose of decentralized health becoming a realtiy is to develop synergies and collaboration networks and share with founders, influencers, venture capitalists, founders and CEOs, Y Combinator, CB Insights and 94 unicorns. The belief is that DAOs will increase access for smaller research and manufacturing institutions and help break into the often-monopolistic big pharma space.
It is too early to know how big a community DAOs can attract, the level of funds they can raise and whether the DAO structure actually benefits” as she points out ”It’s possible to use blockchain affordances and smart contracts without a DAO. There is also concern that there is a risk that the need to provide economic incentives (governance tokens) will competitive and speculative behaviour leading to a centralized governance structure.
LH: What are the negative impacts, in your opinion, of excessive centralisation?
Dr Jane Thomason: Some people in the industry predict that medical projects become vulnerable to attacks because of excessive centralization and parties with a conflict of interest pushing through proposals that will be profitable to them. Challenges exist, including users viewing tokens as yield, not voting rights. Protocols started using their governance tokens as rewards for users participating in the network. This competitive and speculative behaviour leads to a centralized governance structure since tokens slowly accumulate in a few hands.
Other concerns are that projects are prone to vulnerability of attacks because of excessive centralization, and parties with a conflict of interest can push through proposals.
Legal status of DAOs
LH: What about security?
Dr Jane Thomason: Hacking is another worry. Even if there is a security hole in an initial code, its rectification cannot occur until the majority votes. While voting occurs, hackers can exploit a bug in the code. Another issue is the legal status of a DAO.
LH: Who is to sue and sues if a case arises or in case of liquidating a tangible asset owned by the DAO ?
Dr Jane Thomason: It’s not unusual that users don’t fully understand the governance of the projects they invest in and the risks they take. If a professional assessment of risks doesn’t occur, losing funds via a protocol error or a malicious attack puts the users’ funds at risk’’ Dr Thomason remarks. There is also regulatory uncertainty.
Dr Jane Thomason is the founder of a successful international development company valued at US $250 million and she is also the interim chair of the World Metaverse Council and a thought leader in the rapidly developing field of Metaverse, which is projected by Citi to be a $13 trillion industry by 2030. She is on the Editorial Board of the Journal of “Metaverse”, and “Frontiers in Blockchain” and has recently published an award winning book “Blockchain for Global Social Change.”
Dr Thomason has a book on Web 3.0 forthcoming “Advancements in the New World of Web 3: A Look Toward the Decentralized Future”. She frequently speaks at industry conferences and forum on the Metaverse and how this growing industry will impact on business and the economy. Dr Thomason is a “Top 20 Global Thought Leaders in Blockchain” and “Top 20 Global Thought Leaders in Crypto” and she is named as one of eight metaverse experts to follow and top 100 women in Web 3 and Metaverse. She featured in CNN Documentary “DeCoded” and CNN OpEd “The metaverse could be transformative, but its a legal and ethical minefield.”
For the latest developments in medical technology, innovation and healthcare visit Med-Tech World News.
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21st February 2024