Home / Glossary / Decentralized Autonomous Organizations (DAO)

Decentralized Autonomous Organizations (DAO)

Decentralized Autonomous Organization (DAO):

A Decentralized Autonomous Organization, often abbreviated as DAO, is an innovative organizational structure that operates on the principles of decentralization and blockchain technology. DAOs are governed by rules and executed through smart contracts on a blockchain network, without the need for a central authority or traditional legal framework.

The primary purpose of a DAO is to enable a diverse and autonomous community of individuals, often tokenholders, to collectively make decisions and work towards common goals, such as managing the treasury of a blockchain network. These decisions can include funding projects, amending governance rules, or allocating resources.

Key features of DAOs include the absence of a centralized governing body, with decision-making power distributed among tokenholders who participate by casting votes. All activities and votes within a DAO are transparently recorded on the blockchain, ensuring public visibility and accountability.

DAOs are closely associated with the cryptocurrency and blockchain space, leveraging smart contracts to automate various processes. They represent a bottom-up approach to management and have gained prominence for their potential to revolutionize traditional corporate structures by fostering transparency and community governance.

It’s important to note that DAOs prioritize security, as vulnerabilities can lead to significant losses of funds from the organization’s treasury. The concept of DAOs continues to evolve, driven by ongoing developments in blockchain technology and their potential to transform the way organizations operate and make decisions.

Related Terms

Zero Knowledge Proof

Zero-Knowledge Proof (ZKP): A cryptographic method allowing an entity to prove the truth of a statement without revealing any additional information.

Read More »


Year to Date (YTD) in the realm of cryptocurrency refers to a vital metric that assesses the performance of a digital asset within a specific calendar year, spanning from January 1st to the current date.

Read More »

Yield Farming

Yield Farming is an investment strategy in the realm of decentralized finance (DeFi) where cryptocurrency holders provide their assets to a DeFi protocol to earn returns, often in the form of additional tokens.

Read More »