What is a DAO (Decentralized Autonomous Organization)?. A DAO is an online organization governed by tokens and rules encoded in smart contracts. Members submit proposals and vote; execution is transparent.
How it works
Proposals are published on‑chain or in a governance portal. If a vote passes, contracts move funds or parameters per the rules.
Why it matters
DAOs coordinate resources globally without a traditional hierarchy, aligning incentives between contributors and users.
Common pitfalls
- Low voter participation leading to capture
- Treasury mismanagement without clear mandates
- Rushed votes without audits or simulations
Quick example
A protocol DAO funds new features after token holders approve a budget and milestones.
See also
- Governance Token
- Treasury
- Smart Contract
TL;DR: What is a DAO (Decentralized Autonomous Organization)? defined in plain English with practical next steps.
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