Everything you need to know about Decentralized Autonomous Organization

You might have heard much news about how financial authorities in certain ventures tamper the accounts and loot money from the organization’s fund. You might have heard stories of how companies went down due to improper financial management. Are you getting ready to start your own organization but have no faith in traditional organizational hierarchy? Blockchain technology is here to rescue young entrepreneurs with Decentralized Autonomous Organization or DAO development platforms. 

The emergence of blockchain has brought a lot of changes in the financial sector, and almost 60% of the blockchain is used by it. On the other hand, it is creating a revolution by eliminating the centralized authority and third parties in almost every industry. Here is a complete guide for entrepreneurs on DAO development and how to start one.

Getting started

Blockchain technology, its network of nodes to store information in a digital ledger, and its independent, smart contracts make it a completely decentralized technology. It does not involve any centralized network to monitor; instead, they are powered by smart contracts. This nature not only brought decentralization in the finance sector but also brought decentralization in how organizations function. This is made happen through Decentralized Autonomous Organization which is a system that helps in automated decision making.

Understanding the basics of DAO

When you take a centralized organization based on the top-down hierarchy, transparency is at stake, and it is based on blind trust in people. In this digital world, everything is online now, and people are pushed to blindly trust people who they meet online. It is indeed risky to start your venture online. 

There are many cases where they need a decentralized, members-owned community where the decision-making is done on the basis of voting by the members. Take a fundraising venture, a charity organization, a freelance network, or even a venture that pools investment capital. They are in need of a decentralized and flat model without any hierarchy. So whenever there is a need for a fund or a decision, it is automatically made by getting the votes of the members of the DAO. 
A pre-set code of smart contracts is made with all the rules and regulations on which the organization should function. There is complete transparency, and the codes can never be deleted, hacked, or modified without the approval of the community members. This way, there is no tampering with funds and no individual influence on the organization.

Membership in a DAO

When it comes to the membership of a Decentralized Autonomous Organization, there are two types that are developed to suit various sectors.

• Token-based membership

It is a model where the organizations take up the members who own the native token. These tokens are available on the platform, and they can be traded without any permissions in a decentralized exchange platform. The members can also earn tokens as rewards for doing specific work through proof of work or by providing liquidity. 

• Share-based membership

In this model, the members need to submit a proposal for the DAO to join it by giving a tribute in the form of tokens or work. They receive a share in return which depicts the membership. It also gives them ownership and direct voting power. The members can easily exit the DAO after getting their fair share from the treasury.

How do DAOs function?

The smart contract codes serve as their foundation. These codes establish the organization’s rules and serve as the treasurer of the organization. 

Once the contract is live on the blockchain network, only a decision made by collective voting can change the rules. If any of the members try to do something that is not covered by the code’s rules and logic, they cannot succeed. This is because the treasury is also defined by the smart contract, no one can spend the money without the approval of the committee members with majority votes. DAOs do not require a centralized authority or any hierarchical governance for operations. Instead, the group makes decisions collectively, and payments are automatically authorized when votes are passed. 

The main advantage here in DAOs is that the members of the community can be anonymous and this will make an organization of like-minded people who work for a common cause harmoniously under a transparent ecosystem.

The pre-requisite

When it comes to developing a platform in the blockchain network it is important to have some prerequisites before discussing it with your developer. Some of the basic prerequisites are listed here.

• The blockchain in which your DAO is going to operate. Ethereum is a classic blockchain network used by many successful DAO. 
• Penning down the basics of your community. Why do you need a DAO, what is the model of membership you need, fundamental ideation and rules for your smart contracts, etc
• DAO token development
• How are you launching your DAO tokens?
• Smart contracts development
• Node development for DAO
• dApp development for your DAO

Once you get a basic idea of the above requirements you can discuss the development process with a skilled developer who has years of experience in the blockchain industry and smart contract development.

At AppDupe, our expert developers offer you the best in the class transparent development process. We are in the blockchain field for years with a number of projects running successfully. 

Why Us?

With years of experience in blockchain technology, we extend our service in various blockchain networks like Ethereum, Binance chain, Solana, Tron, Polygon, Cardano, PolkaStarter, and more. We are also providing various crypto development services contributing to the blockchain community. We also offer marketing and other listing services making it comfortable for our clients to taste success in the industry. We are experts in providing

• Technical guidance on blockchain
• Post-development services
• Transparent development process
• On-time delivery
• Updated tech stack
• Robust front end and back end
• Round the clock customer support                                                                                                         

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Marketing is my soul mate and writing is my side kick. Using my writing skills to share the knowledge of app development and upcoming technologies.