The concept of a DAO (Decentralized Autonomous Organization) is so drastically different from what we’ve been used to experiencing with our hierarchical centralized structures. For centuries, everything from governmental to financial institutions have been designed to manage and control from the top down.
Yet, like the revolutionary shift occurring between Web 2.0 and Web 3.0, the jump from traditional organizations to DAOs is one that has the potential to facilitate major social change. Defining the terms that make up these newfound organizations would be helpful in giving an idea why it’s such a drastic kind of governance:
- Decentralization- deals with managing complex systems in a localized way.
- Autonomy- introduces the idea of self-governance or self-management.
- Organization- a place where people work together towards a common purpose.
At its core, DAOs are member-owned communities without centralized leadership and have all their specific guidelines and principles designed on a smart contract. This is all based on open-source code that will carry out tasks when certain conditions are met. Once this is established however, it can only be changed through on-chain governance mechanisms.
On the backend, the structure of DAOs derives from the Ethereum blockchain, where its lack of hierarchy makes an inherent simplicity that assists stakeholders in their ability to contribute. The majority of the time participation is available when someone holds a native token of the DAO. This serves to enable group collaboration through a democratized means of voting that does not have any intermediaries.
Voting issues can cover a wide array of topics like managing/securing blockchains, accessing treasuries, or ways to creatively pool capital. In general, these are practices that enable the organization to work towards their goals in a transparent and public manner. This type of innovative ease makes DAOs the preferred form of governance for blockchain projects.
While organizing cooperation without a centralized authority is a huge step, the ability of DAOs to make big decisions or strategic pivots over the long term has not yet been proven. With so much promise and potential, DAOs have the capability of replacing other types of organizations' power structures.
Autonio’s DAO has made impressive improvements in the past few quarters, along with updated benefits for its members.