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The Secret of WHAT IS DAO - From basic to advance

Explore what is DAO and how it works

The term "DAO" is one of many frequently used acronyms but has little to no definition as Web3 and the blockchain become increasingly mainstream. DAO is an abbreviation that stands for “Decentralized Autonomous Organization.” It is a new organizational structure designed to take advantage of the power of the internet and blockchain technology. In this article, we will explore what DAO is. how it works, the best DAO platform, and some of the potential benefits that it offers.

What is DAO?

A Decentralized Autonomous Organization or DAO is a digital organization that operates on the blockchain, with no central authority or government. Its members are committed to acting in the organization's best interests without any authority. All the decisions are taken by smart contracts.

Smart contracts are entirely autonomous and transparent, setting the rules and carrying out the selected course of action. At any time, proposals, votes, and even the code itself may be openly examined by the public.

How does it work?

Every DAO work on a different purpose and the purpose can be driven by a single person or a group of person or a part of some larger projects, Through the use of smart contracts, the DAO's rules are set by a core group of community members. 

The fundamental guidelines for the DAO are outlined in these smart contracts. They are very clear, easy to verify, and open to public auditing so that any potential member may truly understand how the protocol is to work at every stage. These logically coded agreements, which are based on underpinning blockchain activity, require decision-making.

Benefits of Using DAO

There is a wide range of reasons and benefits why an organization or group of people may decide to pursue a DAO structure. Some of these are listed below:


DAO provides a decentralized and autonomous way to manage a company or organization and can help to promote transparency and accountability by providing a public record of all transactions.


D can help to reduce costs and improve efficiency by eliminating the need for central management.


DAO can help to create a more democratic organizational structure by giving all members a say in decision-making.


When individuals inside an entity have a direct say and voting authority on all issues, they may feel more empowered and connected to the entity.


DAO can provide a secure and tamper-proof way to store data and information.


The idea of a DAO inspires people from all around the world to work together quietly to realize a shared vision. With merely an internet connection, token owners can communicate with one another from anywhere in the globe.

Some of the best DAO platforms


DAOhaus is a no-code platform for establishing and maintaining DAOs. The local government owns and runs it. There is no need to look deeper if you want to launch your own DAO or explore the fascinating environment.


Voting on modifications to the Maker protocol is one way to participate in governance for the technology that launched the first impartial stable coin in history, DAI.

Limitation of DAO

There are a number of limitations of the DAO concept that need to be considered before its widespread adoption. 


A single vote may be required to decide a certain action or course of action for the company to pursue if a public corporation is led by a CEO. In a DAO, every user has the opportunity to vote. This requires a much longer voting period when taking into consideration time zones and priorities outside of the DAO.


DAOs are still very new and there is a lack of understanding about how they work. While DAOs bring together a wide range of people, one of their key difficulties is that this varied group of people must learn how to grow, strategize, and communicate as a single organisation.


Because DAOs are decentralized and rely on code rather than humans to make decisions, they are prone to errors and hacks. 


DAOs are not currently regulated by any government or financial institution, which could pose a risk for investors.


In the blockchain platform, the concept of a "Decentralized Autonomous Organization" is now firmly established. DAOs are now essential because they help a corporation systematize its guiding principles, offer reliable tools for making decisions, and do away with the need for paperwork and outside approval. But the fact we need to understand is that technology is new, and both good and bad can happens in any direction with equal probability. Keep learning about it.

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