A DAO is a Decentralized Autonomous Organization is considered as a self-sufficient society that does not require external interventions to function. Dash is the most successful DAO in the Blockchain chain since its creation in 2014, the innovation that Dash’s DAO brought to the world of digital money, was to successfully integrate, a platform for anonymous transactions, project financing and decentralized governance by protocols.
Dash is the first DAO with great success that is based on its master node networks, in which everyone can participate if they have 1,000 Dash. Thanks to the participation system, a Masternode comes to be equal to one vote, which allows it to make decisions about 10% of the reward of the block that goes to the solid treasury system that serves to finance changes in the source code, updates, marketing, improvements, and at the same time innovation is promoted, funding the proposals of community entrepreneurs. Next, we will share 7 outstanding features of DAOs:
Dash’s autonomy is based on a self-financed work model, in which 10% of the reward goes directly to the treasury fund, which eliminates conflicts of interest by not needing investment or donations from any entity, organization or Another external method of the network.
It is decentralized
Decentralization means that anyone can be part of the DAO, as long as it complies with the established norms to participate, in which each member enjoys the same rights. This means that this feature eliminates corruption of governance, since it prevents network control from being in few hands. One way that DAOs have to guarantee their decentralization is not to be affiliated with any particular nation, on the contrary, their creators decided to use the Dash network.
It is organized
The Dash DAO has an organizational structure that allows any member to propose changes through monthly voting, Masternodes holders have the power to decide on the different proposals, which range from marketing decisions to direct modifications to the protocol of Dash This organizational feature allows the group to make unified decisions about the network address.
It is based on Smart Contract
For a DAO to be effective, the first thing that is needed is to have a set of rules or regulations that regulate how the platform will work. For these rules to be taken as valid, they must be coded as a smart contract. In our previous article entitled What are smart contracts, we explain what the operation of this type of contracts is based on and how it is impossible to “breach” because they are maintained and executed autonomously on the Internet.
They have a financing phase and Token
Once the DAO rules are established, the financing phase proceeds, it is important that the DAO has an “internal property” that is the one that will have the true economic value and that will then allow the financing. The Token is the asset that is used for this purpose, in this case it is the Dash (DAOs belong to the organizational part of this cryptocurrency).
Open Source Code
They are platforms that are reserved until the financing period ends and the DAO is deployed, later it becomes an autonomous body independent of its creators and third parties and its code becomes Open Source (open source), which allows Any interested party can access it. This allows the total of your transactions (and established rules) to be displayed on your Blockchain.
Using blockchain technology allows this organization to be decentralized and independent, since it is the users themselves who make the decisions and exercise control over the transactions that are made, which is why DAOs benefit from their main characteristics: transparency, incorruptibility and immutability.
What do you think about this topic? Did you know all these characteristics of DAO?
If you want more information about buying and selling cryptocurrencies you can subscribe to our newsletter and receive the free report entitled applications of blockchain technology and its relationship with decentralized systems.
Image by geralt via Pixabay.com under a creative commons license.