The term DAO (short for “decentralized autonomous organization”) has become a crypto buzzword in 2021, but the concept has real value. According to analytics site DeepDAO, the DAO ecosystem has a total treasury value of $8.7 billion as of June 2022.
Crypto DAOs continue to grow as a community organization model, a means of quickly raising and distributing money for social purposes, or decentralizing blockchain-based protocols.
What is a DAO?
Decentralized autonomous organizations aka DAOs include a distributed treasury, smart contracts (programs that run when criteria are met) and voting tokens.
The first DAO, called “The DAO”, was launched on Ethereum in 2016. While it is possible to establish a DAO on any blockchain that supports smart contracts, most of them run on Ethereum.
Creating a Crypto DAO requires several steps:
- Name the DAO
- Create a mission statement
- Spin the Discord server
- Create a new Twitter account
- Invite people to join the platform
- Learn and start token management
- Create a funding mechanism
- Set up Snapshot or other tools for voting and logging member posts
Every Crypto DAO needs a name that describes its mission, such as ConstitutionDAO, FreeRossDAO, Ukraine DAO, and AssangeDAO.
For ex:
Name: DAO Survey
DAO Type: Education/Club
Mission: To fund and facilitate the exploration of unknown places and to protect historic objects, works and places. Exploration DAO is dedicated to funding people and organizations working to explore and preserve history. The DAO donates all funds raised beyond operating expenses to charities, schools, museums and global organizations.
Next, we want to set up where the DAO will live for member engagement, community building, and announcements. The most commonly used platforms are:
Discord: If any Web2 app is stuck in Web3, it’s Discord, which built a player base but has now also become the home of DAOs. DAO leaders like Discord for its ability to organize thousands of people into different roles and workgroups.
Telegram: DAOs can also use Telegram to create groups and collect members, perhaps before Discord was created.
Here are some popular DAO startup sites:
DAOhaus
DAOhaus is a DAO protocol for connecting existing DAOs and creating a new DAO based on the Moloch framework. A DAO can be launched by setting several parameters:
- Type of DAO launched: Guild (works together to offer services); Clubs (little or no financial decisions); Ventures (for big financial decisions); Grants (distribute wealth); and Products (manages a product or protocol);
- Members’ addresses;
- Filling in the DAO’s metadata, such as its name, social media and website link.
Collab.Land
Collab.Land is not specifically a DAO launch tool, but it is a popular tool used by DAOs to moderate membership. It does this by verifying that each member currently holds a DAO token, allowing access to the various Discord DAO channels and kicking out members who no longer hold the token.
Aragon
Aragon is an open-source platform for launching and maintaining DAOs on the Ethereum blockchain. It offers two main products: Aragon Client, a set of tools for developers to create online organizations that aim for greater transparency and customizability, and Aragon Govern, a DAO management framework with on-chain execution and contention resolution using plug-ins.
Cash management tools
Ultimately, the DAO will need a treasury to store its funds and manage its tokens. Deciding which tool to use depends on the needs of the group and the size of the treasury. The DAO will need a compatible wallet such as MetaMask, WalletConnect or Portis.
Gnosis Safe
Gnosis Safe is an Ethereum wallet that requires a minimum number of people to approve a transaction before it can happen. When the DAO wants to proceed with an action, it is voted on by the DAO members (see slide below) and then executed by a core group of signatories, known as a multi-sig (multi-signature). With Gnosis Safe, users can define a list of signer accounts and a required number of signers, so that no DAO member can move funds independently.
Syndicate investment clubs Web3
To start a Web3 investment club on Syndicate, founders will need to connect a wallet like Metamask to the Syndicate network. Deposits are collected in this wallet and all existing assets in the wallet will be visible to all club members. After the founder of the investment club chooses a name, the platform assigns a token symbol to the club. The syndicated investment clubs can then become the treasury of the DAO built around it.
Voting tools:
Once the treasury is established, the DAO will need a way for members to vote on proposals. Snapshot is by far the most popular tool. It is a decentralized voting system that allows users to make proposals and vote off-chain, meaning voting is done – no cryptocurrency is exchanged – using ERC-20 tokens or even NFTs to prove voting power.
Fundraising tools:
Think of Juicebox as the web version of Kickstarter. Projects use Juicebox to raise funds from their communities through smart contracts on Ethereum. Projects can design a fundraising page and funding structure and define how funds and rewards will be distributed.
Mirror is best known as a blogging platform built on blockchain technology. However, in addition to publishing articles, DAOs can also use Mirror for crowdfunding projects that use Ethereum smart contracts and to convert contributions into NFTs.
Source: https://coingape.com/blog/how-to-create-and-launch-crypto-dao/