Decentralized Autonomous Organization (DAO) is an organization that is controlled by its members and has rules encoded as a transparent computer program.


Many today's internet users want to joint or to start social organizations where they could work with like-minded folks around the globe, to organize themselves in a safe and effective way, and to exchange values in a trusted environment. DAO is the answer.

DAOsí operations are fully transparent and global. DAO takes its orders from its online community. It is not influenced by a central government. As the rules are embedded into the code, no managers are needed, thus removing any bureaucracy or hierarchy hurdles.

In comparison to traditional companies, DAOs have a democratized organization. All the members of a DAO need to vote for any changes to be implemented.

Powered by Blockchain

The proliferation of blockchain technology has given rise to DAO. DAO is a way of organizing with other people around the world. Most members of DAO don't know each other, they establish their own rules, and make their own decisions autonomously all encoded on a Blockchain. Blockchain enables automated trusted transactions and value exchanges.

A DAOís rules and financial transactions are recorded on a blockchain. These transactions are simplified through direct smart contracts.  The smart contract represents the rules of the organization. DAOs are transparent and public, so no one can edit the rules without people noticing.

 

 

 

An Example of DAO: Bitcoin

Bitcoin (BTC) is generally considered to be the first fully functional DAO, as it has programmed rules, functions autonomously, and is coordinated through a consensual protocol.

The Bitcoin network scales via community agreement, even though most network participants have never met each other. It also does not have an organized governance mechanism, and instead, miners and nodes have to signal support.

 

 

 

Funding and Finance

The funding of DAOs is mainly based on crowdfunding that issues tokens. The explosion of Decentralized Finance (DeFi) has led to a rise in interest in DAOs.

For example, a DAO can accept donations from anyone around the world and the members can decide how to spend donations, all without intermediaries

Organizational Structure of DAO

A DAO may function without a legal status as it can be structured as a general partnership.

DAO as a New Trend

DAOs envision a collective centerless inclusive organization owned and managed by its members with all of them having a voice.

Many analysts and industry insiders affirm that this type of organization is coming to prominence, even potentially replacing some traditional companies.

So far DAOs are being used for many purposes such as investment, charity, fundraising, borrowing, or buying non-fungible tokens (NFTs).

Elements of a Fully Functional DAOs

DAOs need the following elements for being fully functional:

1. A set of rules;

2. A funding like tokens that the organization can spend to reward certain activities to their members, and also to provide voting rights for establishing the operation rules;

3. A well and secure structure that allows every investor to configure the organization.

 

 

 

 

The best social system is like a Free Garden. All I would do to create one would be to be a genuine human.

Sonam Wangmo

 

Vadim Kotelnikov advice quotes

Innompic Social System inspires virtuous creativity and turns the Earth to a Planet of Loving Creators.

Vadim Kotelnikov, founder of 1000ventures - personal logo Vadim Kotelnikov

I-Creator