The DAO is an ellipsis of the Decentralized Autonomous Organization, which refers to an organization or entity led by a community without having any primal authority to manage the functioning. That means, DAO is free from any external control and smart contracts and is fundamentally run by its specific community members who, in the meantime, are also the absolute decision makers in reference to how a supposed project, for example, technicalities, exchequer apportion, etc. in the future would be. Also, the body is responsible for establishing and enacting all foundational rules, carrying out the decisions accorded in mutually and even more.
ETH – The second-best cryptocurrency
Ethereum is by far recognized as the second leading crypto currency in the market in terms of market capitalisation and the leading platform in terms of using blockchain technology. According to most professional crypto savvies, DAO seems to be a stately idea grown out of ETH. However, many experts consider the idea to be vague and rather pick at it by citing it to trigger the possibility of dodgy decision-making.
On the other hand, from the perspective of other crypto experts, the idea seems very hopeful and monumental for an organization with decentralized control. The idea although is still being tried out, it is important to mention the first idea termed “The DAO”, propounded in 2016, which unluckily fell flat by turning out a conspicious failure – it caused a total loss of $50 million in the wake of technical issues. Notwithstanding, a wide array of companies, for example, Aragon, Colony, MakerDAO, etc. are turning up actively where The DAO ceased.
How does the DAO function?
DAOs’ functioning is largely dependent on smart contracts, which refer to orderly encoded chunks found very helpful in decision-making depending on its activity on blockchain. While ETH is credited to have started the use of smart contracts for the first time, it is implemented in a variety of other blockchains nowadays.
Codes or arrangements of smart contracts, in general, are used to validate and execute the DAO’s functions. Also, DAOs utilize safe, guileless digital ledger to supervise and validate transactions and that being said, DAO investors consider choosing it easily and consistently.
Is DAO the most decentralized form?
Digital currencies are largely known for being decentralized by nature. This evinces that no single body or authority, for example a country’s government or a central financial bank, is ordained to keep them in line, but they are rather distributed among a mass of computers, networks, nodes, etc. In general, most digital currencies maximize this decentralized state to gain privacy and safety. However, this is not the case with regular currencies and their transactions in general.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/01/01/should-dao-be-considered-the-most-decentralized-form/