What is a DAO
DAO (Decentralized Autonomous Organization) is an organization that is governed through blockchain technology and smart contracts.
To participate in decision-making within a DAO, users typically hold the project's governance tokens.
Key facts
- operates on a blockchain
- governed by its participants
- decisions are made through voting
Simple explanation
A DAO is an organization without centralized management where decisions are made collectively by token holders.
How a DAO works
- participants hold governance tokens
- proposals are created
- token holders vote on proposals
- smart contracts execute the decisions automatically
Where DAOs are used
- managing crypto projects
- DeFi protocols
- decentralized investment communities
Role of DAOs in the blockchain ecosystem
DAOs represent a new model of governance for digital projects.
By using blockchain technology, decisions can be made transparently and collectively without centralized control.
The concept of DAO governance is explained in more detail in a separate section.
Related terms
FAQ
What does DAO stand for?
DAO stands for Decentralized Autonomous Organization.
Who controls a DAO?
A DAO is governed by its participants through voting.
Can anyone create a DAO?
Yes. DAOs can be created using smart contracts.
Where are DAOs used?
DAOs are commonly used to manage crypto projects and DeFi protocols.