Blockchain-based Decentralized Autonomous Organization Is Future!


When I first came across Blockchain [1] three years ago, I realized this is a super-powerful technology which can change the whole world fundamentally. I quickly fell in love with Blockchain, did research and even wrote a Blockchain cookbook, which is widely used by my company and our clients. You may not know Blockchain, but you may hear of Bitcoin which is one of the successful Blockchain applications. The blockchain is the underneath technology for Bitcoin. To put it simply, Blockchain is a distributed digital ledger of transactions and shared among a distributed network [2]. It uses cryptography to allow each stakeholder on the network to manipulate the ledger in a secure way without the need for a central authority. The transaction can be a digital currency like Bitcoin. It can also be smart contracts. If we create an organization based on Blockchain network: everyone within the organization is a stakeholder; the organization is run through rules encoded as smart contracts. The organization we just create is Decentralized Autonomous Organization (DAO) [3] and it is the ideal organization in future.


The new crypto-economic organization, I consider ideal, is a decentralized organization guided by self-governing and autonomously operating software, with its laws written immutably on the Blockchain [4]. As described in [4], there is no human intervention in the DAO. The DAO is fully controlled by an incorruptible set of coded laws, which is very similar to a constitution. The coded laws are written in auditable open-source software, which is distributed across the computers of its stakeholders. A human can purchase unique cryptographic tokens issued by the DAO to become a stakeholder, which is similar to stocks. The DAO issues tokens to raise capital, in the meanwhile, all stakeholders can vote on proposed DAO directions in a democratic fashion and obtain profits from the DAO. The DAO gives its authority purely through code. In this way, token holders have total control over The DAO’s assets and its actions [5]. In DAO, there are no central points of control. In such a peer-to-peer network everything is transparent and confidential. Finances and business rules are auditable by anyone. A single tiny change needs a majority of stakeholders to agree and every action or rule needs to be verified and it is very easy to verify. In such an organization, all stakeholders obey their own incorruptible rule set. No hidden actions or tricks within the DAO. As described by Seth Bannon [6], “The DAO is a paradigm shift in the very idea of economic organization. It offers complete transparency, total shareholder control, unprecedented flexibility and autonomous governance.”


Because of autonomous, distributed, transparent, confidential and self-regulating properties, there is no human bias and full of collective intelligence in the DAO. I think DAO has advantages to solve many issues or challenges in the traditional organizations. The DAO is the ideal organization of future. The future of trust is here now, without a crappy boss!



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2 comments on “Blockchain-based Decentralized Autonomous Organization Is Future!”

  1. I’m very familiar with the use of blockchain in cryptocurrency, but the idea of a business run through blockchain technology is very different. While some believe cryptocurrency is the future, some think not. I believe that with the use of DAO in business, the true power of blockchain will emerge. I further researched the idea, and there is a company that is called “The DAO” which is basically a crypto VC, that is spreading this new idea. An issue that we have today in society are hackers, from elections to emails, information is being stolen. This can be an issue with a company like this since when they raised 150 million, 33% of it was stolen. While this technology can be a great disruptor in the industry, it needs to be implemented correctly with high amounts of security, to allow for success. Thank you so much for writing this post, I really enjoyed learning about this new technology. One quick question though, how did you create a blockchain cookbook?


    1. I am glad that you enjoy the post. The Blockchain cookbook I wrote serves as an educational tutorial for my company’s clients. This book is for people who want a conceptual understanding of Blockchains; people who want to play with my company blockchain solution to get to a level of comfort with the tools and at least be able to build and run sample programs; people who really want to get deeper and go beyond samples and actually be able to build blockchain solutions for real-world problems.


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