A Primer To DAO
DAOs, or decentralized autonomous organizations, are collectives that leverage blockchains and other technologies to make decisions in a democratic manner.
DAOs, or decentralized autonomous organizations, are collectives that leverage blockchains and other technologies to make decisions in a democratic manner.
A DAO's goal is to decentralize the operation of firms, nonprofits and other entities by making functional and financial information transparent and allowing token-holding members to propose, vote on and enact changes.
DAOs come in many different shapes and sizes, including ones that govern crypto protocols, make venture investments, provide services to other DAOs, and purchase NFTs.
DAO Landscape
- According to analytics firm DeepDAO, there are more than 4,800 DAOs in operation with ~$8.3 billion in treasuries.
- In 2016, a DAO known as “The DAO” raised $150 million in ether to create an organization for collective investment in blockchain projects.
- 17,000 members of Constitution DAO raised $47 million and tried to buy one of 13 surviving original copies of the U.S. Constitution.
- AssangeDAO raised over $53 million to bid on an NFT that would support the release of WikiLeaks founder Julian Assange.
- The LinksDAO sold out of memberships and raised more than $11 million in its quest to buy a real-world golf course.
- A crypto investment DAO called dao5 has launched a $125 million fund.
- Infrastructure companies that provide DAOs with tools to launch and grow have collectively raised more than $100 million in recent months.
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One of the biggest obstacles to DAOs today is a lack of legal recognition. Because DAOs are not legal entities, it can be difficult for them to interact with other organizations, as well as protect their members from personal liability. By becoming a legal entity, a DAO can gain certain privileges that make it easier for the organization to engage in activities like hiring people, owning assets and intellectual property, and making tax arrangements.