Blockchain and Cryptocurrency are an integral part of our future, but they’re intimidating and confusing for those still unfamiliar with blockchain technology. It has come to our attention at MacguyverTech that there is decidedly an audience for a more basic approach to smart contracts, blockchain, cryptocurrency, the Metaverse, Web 3.0, and related topics.
To that end, we’re writing a “Back to Basics” series that will hopefully be of use to our readers. “Blockchain Explained” was our first, and it can be read here. This article is about the basics of Decentralized Autonomous Organizations (DAOs). Keep in mind that what we’re presenting isn’t unlearnable; it only requires patience. At one point, everyone was a beginner.
So, what is a DAO, really? The most important part of the acronym is the “Decentralized” part; meaning that there’s no central governing person or body to make decisions. A DAO is a community-governed organization which executes operations based on the majority decision of the community that is a part of it.
The “Automated” part makes this possible, as a DAO is made up of smart contracts that automatically perform functions based on specific conditions. (To read our blog post on smart contracts, go here.)
Now for the important question: Why is this important?
Much like everything else blockchain-related, a DAO is a transparent, open and honest platform for transactions. It is quite possibly the most democratic and corruption-free method for decision-making in existence. It has applications in communities, cryptocurrency exchanges, governmental organizations, AI, and much more.
That last bit, “Governmental Organizations and AI,” might sound ominous. Before we welcome in our new DAO Overlords, lets again remember that a DAO, like anything else blockchain-related, is only as good as its programming…or in this case, associated smart contracts.
But for the purposes of the immediate future, DAOs are popping up all over the place in Web3 community-based organizations. They’re open, honest, fair…and here to stay.
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