Ajulu’s Thoughts
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Ajulu’s Thoughts

What are DAOs? Decentralized Autonomous Organizations Explained

DAOs are an effective and safe way to work with like-minded folks around the globe. Think of them like an internet-native business that’s collectively owned and managed by its members. They have built-in treasuries that no one has the authority to access without the approval of the group. Decisions are governed by proposals and voting to ensure everyone in the organization has a voice. There’s no CEO who can authorize spending based on their own whims and no chance of a dodgy CFO manipulating the books. Everything is out in the open and the rules around spending are baked into the DAO via its code. A comparison: DAO A traditional organisation Usually flat, and fully democratized. Usually hierarchical. Voting required by members for any changes to be implemented. Depending on structure, changes can be demanded from a sole party, or voting may be offered. Votes tallied, and outcome implemented automatically without trusted intermediary. If voting allowed, votes are tallied internally, and outcome of voting must be handled manually. Services offered are handled automatically in a decentralized manner (for example distribution of philanthropic funds). Requires human handling, or centrally controlled automation, prone to manipulation. All activity is transparent and fully public. Activity is typically private, and limited to the public. DAO examples To help this make more sense, here are a few examples of how you could use a DAO: A charity — you can accept membership and donations from anyone in the world and the group can decide how they want to spend donations. A freelancer network — you could create a network of contractors who pool their funds for office spaces and software subscriptions. Ventures and grants — you could create a venture fund that pools investment capital and votes on ventures to back. Repaid money could later be redistributed amongst DAO members. Source: Learn Something New Newsletter Go check out the “Learn Something New ” Newsletter.

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