62 - Governance and Capital | Joel Monegro

Apr 26, 2021

Joel Monegro, a partner at Placeholder VC, dives into the transformative world of decentralized governance and capital. He discusses how governance structures impact capital allocation and the growing importance of governance tokens in reshaping traditional institutions. The conversation highlights the evolution of governance from tribal systems to blockchain-based frameworks and explores the role of technologies like smart contracts in redefining capitalism. Monegro emphasizes the generational impact of crypto governance on societal change and wealth distribution.

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INSIGHT

Governance Definition

Governance is about decision-making structures within groups.
It applies to small groups like friends and large ones like nations.

INSIGHT

Objects of Governance

Governance typically centers around economic resource allocation within a system.
This applies to households, companies, countries, and even global entities.

INSIGHT

Capital as Control

Capital is not just money; it's any form of control over economic resources, including social or political influence.
This expands traditional economic definitions.

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Joel Monegro is a partner at Placeholder VC, where he invests in decentralized networks and companies that democratize data, wealth, and power.

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Bankless Podcast #62 | Governance and Capital Guest: Joel Monegro

Joel Monegro is a partner at Placeholder, a venture capital firm where he invests in decentralized networks and companies that democratize access to data, wealth, and power. He started the firm in 2017 with his friend Chris Burniske and mentor Brad Burnham after three years at Union Square Ventures, developing the firm’s early blockchain thesis and portfolio.

In this episode, Joel explores the relationship between Governance and Capital, broadly used terms in desperate need of proper definition. Governance focuses on the decision making process in regards to capital. Capital is a broad term for economic resources – that which has utility. Governance can refer to autocratic individual decision making, but we dive into governance as a mechanism for collective decisions and achieving consensus. It is typically tied to a social and/or economic system and is made of structures that drive decision making among groups of people.

Capital represents influence, power, or control over economic resources. Capital and its utility are natural social phenomena and are relative in nature. Governance and Capital are deeply linked and arguably synonymous. The optimization of governance over capital and capital instruments are priorities of blockchains, which involve both financial and governance technology. The utility of capital can increase when pooled, especially when governance is scaled and effective.

A core argument of the crypto industry is that blockchains offer a more advanced instrumentation of capital, creating maximally efficient pathways for the exchange of value. They allow the transaction/contract settlement layer to migrate away from a state-backed system, which involves the use of courts and violence to achieve security. Replacing violence with cryptographic consensus is a powerful but challenging concept – one explored deeply in this episode with Joel Monegro.

------ Resources:

Placeholder VC Blog https://www.placeholder.vc/

Joel on Twitter https://twitter.com/jmonegro?s=20

Generations - Strauss and Howe https://www.amazon.com/Generations-History-Americas-Future-1584/dp/0688119123

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