DAO (Decentralized Autonomous Organization) is a community-led entity with no central authority. It is governed by rules encoded in transparent smart-contracts on a blockchain, with members collectively making decisions.

A New Model for Organization

For centuries, organizations have been run by a top-down hierarchy: a CEO, a board of directors, or a small group of leaders. This centralized model has its flaws—decisions can be slow, opaque, and made in the interest of a few, not the many. The idea of a DAO was born from the desire for a more transparent, efficient, and truly democratic way to organize people and resources.

Instead of a rigid hierarchy, a DAO operates like a digital collective. The rules of the organization are written into a set of smart-contracts on a blockchain. Once these rules are deployed, they are immutable and can only be changed by a vote from the members. This eliminates the need for human intermediaries and ensures that all activities, from treasury management to funding decisions, are automated and transparently executed by the code.

How to Participate in a DAO

Participation in a DAO is typically open to anyone who holds its governance tokens. These tokens grant you the right to submit proposals and vote on the proposals of others. To join, you first need a compatible wallet. You can then acquire the DAO’s governance tokens, usually through a decentralized exchange or by providing services to the DAO. Once you hold the tokens, you can use a DApp interface to access the governance portal. Your voting power is typically proportional to the amount of tokens you hold.

The Big Picture

DAOs represent a fundamental shift in how people can coordinate and manage collective goals. They are a core pillar of the Web3 vision, enabling a new era of trustless, permissionless collaboration on a global scale. From managing DeFi protocols to funding public goods, DAOs demonstrate how decentralization can create more equitable and robust organizational structures.