Nantan DAO Chronicles (Part 2)

What is the goal?

"Promote the integration of rural construction and Web3."

Nantang DAO is committed to promoting the holistic development of local villages while fostering mutual learning between rural construction and Web3 communities: "Seek a community DAO from the local, and find a path to globality from crypto." Specific goals include upgrading and transforming the cultural courtyard of Nantang Agricultural Cooperative, gradually building a base for Web3 partners in the countryside; at the same time, deeply integrating with the local Nantang cooperative, striving to establish a system of work points that can be used for governance and is economically sustainable.

Nantang DAO is essentially a rural service organization aimed at supporting rural development through democratic governance and economic support. It hopes to leverage cryptocurrency and Web3 technology to create a new democratic decision-making process, achieving democratic management and allocation of treasury funds to meet local needs in infrastructure construction and cultural activities. However, there is a significant gap between ideals and reality. In practice, Nantang DAO currently resembles a somewhat rigid attempt to transplant the models of other DAOs online to the countryside, failing to closely align with the fundamental needs of the rural areas, and its specific goals appear to be relatively scattered and lacking focus.

Democracy is not the democracy of villagers; rural construction is the rural construction of the object.

In the Nantang DAO, only two members are local villagers born and raised in the area, and they are also employees of the cooperative. The purpose of the DAO in including them is to better carry out local work, while more ordinary villagers have not joined the DAO organization, let alone participated in the decision-making process of the organization. Therefore, the democracy of the Nantang DAO is merely a small-scale internal democracy, failing to widely connect and mobilize the rural community. This practice inevitably degenerates into "object-based rural construction," which is rural development led by external entities rather than a governance model driven by the villagers themselves. Due to the lack of deep embedding in the rural community, the sustainability of this model is concerning. Currently, for the entire village, both the Nantang DAO and its members largely remain outsiders.

Diversified goals, each fighting for themselves

"Promoting the integration of rural construction and Web3" is an attractive and ambitious goal, carrying inherent legitimacy and broad value concerns. Apart from Nantan DAO, few local DAOs in China pursue such a vision for rural areas. However, this ambitious concept is fraught with challenges in practice, whether for those involved or observers, and the question inevitably arises: "How exactly do rural construction and Web3 combine? What is the practical path of Nantan DAO?" The establishment of Nantan DAO, along with the departure of some core members to Chengdu to establish a new base, has increasingly highlighted the divergences in organizational goals, and the team is clearly trapped in a dilemma of goal misalignment.

Build a community or commercialize?

Regardless of whether from an individual or organizational perspective, DAOs need to balance the potential conflicts between commercial interests and public interests. In many DAOs, many members only care about short-term commercial returns and do not pay attention to organizational governance, leading to frequent "Free Rider" problems, which conflicts with the long-term vision of DAO builders. From an organizational perspective, pursuing production efficiency and commercial value growth may require a centralized power structure to improve decision-making and operational efficiency; while emphasizing public interest requires a democratic organizational structure and decision-making mechanism to ensure equal participation of members and information transparency, but this may lead to a slow decision-making process.

Community building has always been a core issue for Nantang DAO. It encompasses both the overall development of rural construction and the Web3 field, as well as deep integration with the local Nantang community. As an internally highly active project, the "Rural Construction Web3 Bilateral Enlightenment Program" was proposed and funded by Liu Bing, and is jointly managed by core member Bi Bing and teacher Liang Shaoxiong from the rural construction field. By promoting communication between rural construction teams and the Web3 community through funding, the program supports team members in participating multiple times in Web3 events domestically and internationally, and in delivering presentations at universities, thus generating a certain influence within the industry.

At the same time, community members reflected from a commercial perspective. After a period of exploration, members gradually realized the economic unsustainability of the existing model. However, compared to pursuing short-term profits, the community's current exploration is more practical, mainly focusing on the real project needs and feasible scenarios in the rural construction field. As Bi Bing said: "Although the community's primary goal is not profit at the moment, everyone needs to hone their skills by doing some concrete things, understand more real needs, and then consider the possibilities of commercialization and profitability."

Incentive and Circulation Experiment - Nantang Bean

On August 20, 2024, Nantang Bean (NT) officially launched on Optimism, with an initial issuance of 10 million tokens. In terms of value anchoring, one Nantang Bean is equivalent to one Chinese Yuan.

Functionally, Nantang Bean serves as a community incentive, fulfilling the dual roles of "contribution record" and "voting rights certificate." On one hand, the Nantang DAO employs a working hour system to record member contributions, allowing members to autonomously log their working hours via the Fairsharing platform. According to the community's current standards, each working hour corresponds to a reward of 60 yuan equivalent in Ethereum and 60 Nantang Beans. Although the validity of working hours primarily relies on mutual evaluation among community members, it may also be flexibly adjusted based on specific circumstances (such as initiating a vote for adjudication), with its ultimate validity depending on community consensus. On the other hand, Nantang Beans also possess the attributes of governance rights certificates. Members holding more Nantang Beans will have greater voting weight in community decisions. This design, which directly links contribution records to governance power, is essentially a governance incentive mechanism that theoretically enhances community members' enthusiasm and autonomy in participation.

Limitations of Hourly Work System

Although the Nantang DAO has made significant strides in its incentive mechanism, the current "contribution record" system has exposed a series of problems in the application and evaluation process of work points, such as unclear entry requirements, a single evaluation standard, and a malfunctioning peer review mechanism. This reflects a lack of clear entry standards in the current incentive mechanism, which is at least lacking in transparency. This "invisible threshold" prevents many members' contributions from being recognized, effectively shutting them out.

Community members generally reflect that the "equal pay for equal work" model, which uses working hours as the sole evaluation criterion, has significant limitations. Different members have varying work experience and efficiency, and calculating compensation solely based on hours effectively "encourages low efficiency in disguise." In addition, the types of community tasks are diverse, and the time required for many tasks is difficult to quantify. Furthermore, some members are not accustomed to self-reporting their work hours, which complicates the issue even more.

So, has the peer review mechanism played its due role in avoiding these problems? The answer is very limited. Members are generally more conservative, taking each other's feelings into account and are reluctant to evaluate others. This unwillingness to engage in peer review weakens the effectiveness of the mechanism.

In the face of these challenges, the Nantan DAO is internally attempting to reform its incentive system. Currently, the community is beginning to explore project-based funding applications, with the distribution of funds depending on the evaluation of project outcomes. Some proposals have attempted to set project milestones to assess progress in phases and disburse corresponding funds. In addition, some members have suggested adopting "retrospective incentives," which involve distributing funds based on the quality of results after task completion. Although the direction of reform is promising, the community has yet to develop a mature plan. There are still differences among members regarding which incentive methods should be used in different situations. This is closely related to issues such as noticeable "tension" within the community and unclear organizational goals. How to balance the flexibility and normativity of incentives, and how to ensure fairness while encouraging exploration, remain challenges that the Nantan DAO needs to address further.

Let Nantang beans circulate

In addition to serving as an incentive and governance certificate, the community is also considering more circulation scenarios, allowing Nantang Beans to play a greater role as a "trading intermediary." The most representative event is the "New Year Goods Debt Conversion and Work Points Promotion Plan" implemented around the Spring Festival in 2025. This circulation experiment of Nantang Beans is not small in scale, primarily aiming to help alleviate the long-term debt problems of cooperatives by allowing creditors of cooperative mutual fund projects to exchange Nantang Beans for New Year goods, thus creating actual usage scenarios for Nantang Beans. According to the initial design, Nantang DAO will issue an additional 20% of Nantang Beans (a total of 38,400 by the end of the year) to the cooperative account. The cooperative will use these Nantang Beans to exchange Ether from the Nantang DAO's treasury and then use this money to purchase daily necessities (rice, flour, cooking oil, etc.), while also distributing the Nantang Beans evenly among the creditors. Creditors can use Nantang Beans to exchange for New Year goods worth no more than 400 yuan, and the cost of these New Year goods can be used to offset debts.

In the initial planning, the circulation experiment of the Nantang DAO was quite ambitious: by clearly demonstrating the output mechanism, system operation process, and exchange rules of Nantang beans, it aimed to cultivate the habit of using tokens among villagers. However, reality contrasted sharply with the blueprint—the anticipated scene of villagers autonomously scanning codes to use Nantang beans never materialized; all token circulation ultimately relied on the manual operation of the digital wallet by the cooperative administrator Yang Zhen in the background. Furthermore, according to Liu Bing's recollection, there were even instances of helping elderly people transcribe wallet mnemonic phrases, but fortunately, this behavior was stopped in time. For ordinary villagers in the area, the technical threshold and difficulty of using virtual currency wallets were still too high.

Although the system has achieved short-term token circulation, there are obvious flaws in this flow. When reviewing the entire New Year goods plan, the intern of the cooperative, Jian Qiao, pointed out bluntly: "This approach only increases costs, and the villagers don't care about points; this method does not solve everyone's problems." The circulation and promotion of Nantang beans have always been misaligned with the villagers' core demand for "debt collection and cashing out." Some young creditors stated, "We only want cash, not New Year goods," while Grandpa Chang and Grandpa Liu, who were interviewed by the author, were more compelled by the reality of "having something is better than having nothing," and could only choose to "slowly accept this method." However, the value of daily necessities is just a drop in the bucket against heavy debts. At the villagers' meeting organized by the cooperative, several creditors expressed that if the use cases for Nantang beans could be expanded to include redeeming production materials such as seeds and fertilizers, they would be willing to accept this approach.

United as One: The Warm New Year Goods Plan

As the year-end approaches, the cooperative, facing enormous pressure due to a large number of creditors and a shortage of funds, is in a difficult situation. On one side are the villagers who watch their years of savings evaporate, facing the survival pressures of life, death, and illness. On the other side are the bankrupt debtors and the cooperative that feels powerless to intervene. Although it has been decided to exchange Nantang beans for New Year goods, the quantity of Nantang beans in the cooperative's wallet is very limited, and the available New Year goods for procurement are few. In this situation, the members of the Nantang DAO and the cooperative members discussed and voluntarily decided to "lend" their Nantang beans to the cooperative, helping to alleviate its pressure. It is no exaggeration to say that the members of the Nantang DAO express their support for the cooperative's "debt repayment with goods" action through their actual actions, offering their love to the local villagers with the "work points" earned from their labor.

After learning about this heartwarming story, I feel that although the "New Year Goods Plan" failed to facilitate the circulation of Nantang beans, and is merely a drop in the bucket in the face of heavy debts, its implementation has transcended the meaning carried by money itself. In the face of the villagers' suffering, the people here choose to temporarily set aside their prejudices and use everyone's kindness.