A DAO stands for a decentralized autonomous organization. Those are three pretty big words, so let’s break it down a bit more! DAOs and their members usually form around a shared mission, interest, or goal. DAOs are communities where each member is an owner and manager of the organization. Each member of the DAO has the ability to make contributions and help set the rules, sort of like a book club.
When it comes to money, something cool that all DAOs have in common is that they all have a shared Treasury – a pool of money collectively owned and managed by the DAO’s members. Within a DAO, members can make proposals to vote upon how this money is used. For example, like in a book club, each member of the club suggests what book they want the group to read, the snacks they want at the meeting, and the general rules of the club.
There are many different types of DAOs! Social DAOs that are community-focused and organized around a shared interest + goal. Investor DAOs are where investors pool capital and vote upon what to invest in. There are also Project DAOs – DAOs that are designed to create and ship products and services.
DAOs are a great way for people to come together over a shared mission where everyone has a say and all benefit from making amazing things happen together.