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Distributed Autonomous Organization
A DAO or decentralized autonomous organization is a form of smart contract which aims to reproduce the governance structure of a corporation or coop attached associated with cryptoasset held by the smart contracts.
DAOs are experiments in autonomous governance and voting structures (quadratic voting, continuous voting, etc) which give voting rights proportionally to the "shareholders" of the structure by their percentage of ownership of the governance token issued by the DAO.
DAOs are a form of regulatory arbitrage which attempt to recreate the regulated of creating voting shares in corporations. Instead this DAOs place this practice outside the regulatory perimeter and have no recourse for shareholders in the presence of fraud.
DAOs are best understood as shares in a common enterprise which is run by potentially anonymous entities and which has no restrictions on the provenance of funds held by the "corporation" basically acting as a self-governing crypto slush fund. DAOs may be attached to a enterprise which is an attempt at solving a hard public goods problem such as fixing climate change or universal basic income.
Examples
- Constitution DAO
- Spice DAO
References
- [@morrison_dao_2020]
- [@wright_measuring_2021]
- [@securities_sec_2017]
- [@rikken_ins_nodate]
- [@brennecke_-central_2022]