DAO Platform Development

submitted 3 years ago by kavin to cryptocurrency

What is DAO and what does the company of the future have to do with it

DAO Development Services Over the summer, a group of “crypto fans” raised funds to jointly make a seven-figure investment: the group bought the only existing copy of the album “Once Upon a Time in Shaolin” from the hip-hop group Wu-Tang Clan for an impressive $4 million.

Over the summer, a group of "crypto fans" raised funds to jointly make a seven-figure investment: the group bought the only copy of the album in existence.

The DAO team posed for a photo with their newly acquired album Wu-Tang

The buyer was only revealed on October 20: it turned out to be an organization known as DAO . The announcement came as a pleasant surprise to the crypto community and attracted media attention.

DAO are no strangers to the world of rare collectibles. In June, they bought an NFT of the original Doge meme for $4 million.

However, DAO is not your typical investment firm. As their name suggests, they are a decentralized autonomous organization and are powered by blockchain technology.

More recently, DAOs have begun to attract the attention of major investors, including billionaire Mark Cuban, who has called them "the ultimate combination of capitalism and progressivism." Venture capital firm Andreessen Horowitz (a16z) has also run multi-million dollar fundraising campaigns for individual DAOs and companies facilitating DAO creation.

And given that the crypto community is calling DAO “the next big thing” and serious investors are already starting to take notice, investors might be wondering: what, exactly, is a DAO?

CNBC has collected everything you need to know about them: from how they work to the future that experts predict for them.

Online community with shared bank account

DAOs can take many forms and structures, but to put it simply, “DAOs are an online community with a shared bank account,” explains Cooper Turley, investor and creator of several popular DAOs.

After that, they decide how to pay for the mission of their DAO together.

Many DAOs fall into one of two categories: those that co-manage open source blockchain projects and those that make investments. The latter may operate as LLCs (limited liability companies), venture capital firms or investment firms. DAO also belongs to the latter.

The specifics of each DAO, including type, structure, rules, and governance process, depend on the group and its purpose.

For those who remember how in 2016 the attackers broke the first DAO and stole $ 50 million, this period may have a negative meaning. But while certain risks still remain, DAOs have come a long way since then.

Types of DAOs

It is important to understand that DAO is a broad term that includes many different types of groups and businesses. The two organizations may be completely different, but both are DAOs.

Here are some examples of famous DAOs:

DAO collects NFTs and invests in other assets

DAO collects and sponsors projects created by black women and non-binary artists.

The Collective DAO funds women and non-binary individuals in the crypto

Meta Cartel Venture DAO is a commercial organization that invests in decentralized applications in the early stages of development. How do they work

DAO Development Services To understand DAOs, one must first understand the technology they are built on. Most DAOs rely on "smart contracts" - code that runs on the blockchain.

Blockchain is a distributed database. The most famous application of this technology is the public documentation of transactions in cryptocurrencies and other digital assets such as NFTs, but there are many other ways to use it. For DAOs, the blockchain is their backbone that preserves their structure and rules.

Traditional organizations are usually hierarchical. The board of directors, executives or top management determine the structure of the company, and only they have the authority to change it.

The DAO, on the other hand, does not have a single leader or group of leaders. DAO governance rules are determined by smart contracts on the blockchain. The only way to change them is through a vote in which all members of the DAO take part.

For example, DAO members collectively decided to buy a Wu-Tang Clan album and then created an NFT to prove their ownership of the album. Since the DAO members share ownership of the NFT, they also share ownership of the album.

Large DAOs sometimes form teams led by elected leaders responsible for various aspects of the organization. This allows you to resolve some minor issues without involving all participants in the vote.

The most important aspect of DAOs is their transparency, Turley explains. Every DAO solution must go through the proposal, discussion, vote, and documentation stages, and each step is publicly available.

Although each DAO has its own structure, when entering a typical DAO, you must agree with the proposed program code. It is difficult to change it, because each attempt must go through a voting process in which all participants take part.

DAOs are “very democratic,” explains Aaron Wright, co-founder and CEO of Open Law, a blockchain protocol for making and executing legal agreements. Wright has helped launch a number of DAOs, including Flamingo DAO , which collects NFTs.

They work like the Internet - on a rough consensus. If more people support the project, the decision has been made,” he explains.

To get the right to vote, you usually need to buy governance tokens - cryptocurrencies tied to a specific project. In some DAOs, these tokens can only be obtained through structured funding cycles. Demand for them can sometimes exceed supply. By owning DAO governance tokens, owners gain rights similar to those of LLC shareholders and can influence the future of the organization.

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