Welcome to the DAO
The advent of a new era requires advanced productivity, which is a necessary condition and important guarantee for the development of any affairs. In the process of liberating productivity, how to effectively connect external resources with internal needs will be the key. DAO, as a new type of organization running at high speed, can complete the cross-age development of ecology through effective unified rules, high transparency and stakeholders with common mission. So what exactly is a DAO? What makes it the ultimate management method for future organizations?
What is DAO
In the long history of human development, organizations have often been constructed in a highly centralized form, and even in modern societies that promote freedom the attribution of value power in any organization remains centralized, and organizational decisions are usually the responsibility of one or a few people, while the influence of ordinary people is very limited. In a centralized organizational structure, ownership, social hierarchy, and non-uniform rules for implementation create obstacles to the development of traditional organizations. The emergence of DAO (Distributed Autonomous Organizations) will solve these problems.
A decentralized autonomous organization (DAO) is an entity without central leadership. Decisions are made from the bottom up in a blockchain-native organization that is collectively managed and owned by its members, i.e., collective ownership. Initially, the rules of a DAO are set by a core team of the community using smart contracts that demonstrate the basic framework used to operate the DAO. They are highly transparent, verifiable and publicly auditable, so that any potential member can fully understand how each step of the protocol works.
These pre-defined rules will be collectively managed and owned by the DAO members, and the code is specified to be executed on a blockchain smart contract, where the code is the law. Since it is a series of operations on the chain, no one can tamper with the rules maliciously. It can be said that DAO is a commitment to share value with the community, with a shared mission at the core of the digital native community.
The DAO is one of the most important structures in the crypto ecology that will change every aspect, maybe even your life for years to come. If 2020 is the year about DeFi and 2021 is the year about NFT, then 2022 will be the year of the DAO.
Examples of DAO
A DAO is a combination of a smart contract and a community. Unlike traditional organizations, DAOs are not managed by individuals or teams, but by all of their members, who collectively manage decisions within the DAO through a community token-based voting mechanism that is executed according to predefined rules in the smart contract. According to relevant statistics, there are 180 DAOs managing over $10 billion in assets and attracting nearly 2 million members.
Classification of DAOs
Protocol DAOs: Rather than leaving every decision to the development team, protocol DAOs emerged as a way to give users collective governance over the future direction of development.
Investment DAO: Members crowdsource assets and invest them in various goals to meet investment expectations.
Collection DAO: The aim is to collect NFT. collect specific artists, platforms and collections of work to create long-term value for NFT.
Media DAO: Designed to reinvent the way content creators, consumers and media interact, these DAOs no longer rely on advertising-based revenue models, but instead use Token incentives to reward creators and consumers.
Grants DAO: Similar to investment DAOs, members will pool funds and deploy them to a variety of goals, the only difference is that Grants/philanthropy DAOs invest without expectation of financial return.
To date, DAOs have been used for a variety of purposes, including investment, philanthropy, fundraising, lending, or purchasing virtual land, all without intermediaries, giving you the most immediate benefit. DAOs are open to everyone worldwide without borders.
What are the advantages of a DAO?
A DAO is a democratic autonomous organization compared to a traditional company, where all members vote on any changes to be implemented, rather than a single party implementing the changes, and where the DAO can focus on what it wants to accomplish, and where the incentives are fair and based on the level of contribution, and where you take the risk for your decisions while enjoying very fair incentives.
To understand the advantages of DAO we can start from its name, DAO full spelling is: decentralized autonomous organization
Decentralized: DAO is deployed on the blockchain and is transparent, decentralized and protected from tampering.
Autonomous: collectively managed and owned by its members, i.e. collective ownership.
Organization: All final voting decisions in a DAO will effectively follow the rules embedded in its code.
In addition to the 3 advantages mentioned above
Transparency: DAO provides users with a clear set of rules and regulations. members in a DAO can see all transactions that occur on the blockchain.
Efficiency: DAOs are a great way to collaborate globally, as the technology makes them truly borderless. The rules of the covenant are also clear, and once a decision is made according to the DAO’s framework, the contract is automatically executed.
Anonymity: Members can invest in DAOs anonymously, which often means they can be more flexible and experimental.
MpaceDAO is an investment-based DAO platform built on ETH-EVM. By donating irreplaceable digital assets such as virtual land and NFT to invest and fund Web3 eco-projects, it contributes to the ecological development and the benefit of DAO members. mpaceDAO’s vision is to break the inequity and opacity of traditional investment institutions and create an investment DAO platform that is decided by the community members together.