What is a DAO?
Do you want to know what are DAO's? How do they work and operate without borders? We got you covered
Let’s Talk About “DAOs”
[Trust-Less] [Borderless] & [Limitless] Community Organizations
A DAO, or “Decentralized Autonomous Organization,” is a community-led entity with no central authority. It is fully autonomous and transparent: smart contracts lay the foundational rules, execute the agreed-upon decisions, and at any point, proposals, voting, and even the very code itself can be publicly audited.
DAOs are internet-native organizations collectively owned and managed by their members. They have built-in treasuries that are only accessible with the approval of their members. Decisions are made via proposals the group votes on during a specified period.
Part of the elegance of this framework is the alignment of incentives. That is, it is in the individual’s best interest to be forthright in their voting and only to approve proposals that serve the best interest of the protocol itself.
A DAO works without hierarchical management and can have a large number of purposes. Freelancer networks where contracts pool their funds to pay for software subscriptions, charitable organizations where members approve donations, and venture capital firms owned by a group are all possible with these organizations.
Ultimately, a DAO is governed entirely by its members who collectively make critical decisions about the project's future, such as technical upgrades and treasury allocations.
How does a DAO work?
A core team of community members establishes the rules of the DAO through the use of smart contracts. These smart contracts lay out the foundational framework by which the DAO is to operate. They are evident, verifiable, and publicly auditable so any potential member can fully understand how the protocol is to function at every step.
DAOs operate using smart contracts, which are essentially chunks of code that automatically execute whenever a set of criteria are met. Smart contracts are deployed on numerous blockchains nowadays, though Ethereum was the first to use them.
DAOs are fully autonomous and transparent. As they are built on open-source blockchains, anyone can view their code. Anyone can also audit their built-in treasuries, as the blockchain records all financial transactions.
DAOs are going to take the world by storm! Do you agree?
Stay tuned for more.
Join our newsletter & social media channels for blockchain, crypto news, videos, how-to's, and guides.
Chess Player & Digital Wizard🤖👾🈯️
No comments yet. Start a new discussion.