Decentralized Autonomous Organization and how they work

DAO to the chinese means a way human beings suppose to behave in a particular community. Decentralized Autonomous Organization is a structure of regulations that is built on decentralized blockchain collaboratively and mutually governed by members without the need for hierarchical administration and management. The groups work hand in hand through the aid of smart contracts to enable members approve payments, venture capital businesses and make other concurrent and like minded decisions on how the organization's asset and wealth are distributed. Hence, control is spread out instead of stratified

HOW DOES DAO WORK?

When an organization embraces DAO the stakeholders and associates write out the rules, regulations,terms and conditions of the community using open source codes and bounds or enforces it with a smart contract that automatically execute whenever a set of instruction are met. This really provides a controlled and ordered system without hierarchy unlike the traditional system. It imitates a company's composition and form

The community has governance token which the members use to make decisions and the greater the contribution of a member to the project the greater the value of the member's vote increases.

A major characteristics of a DAO is that they generate their capital internally(through the ownership of token) which is then used to ensure the organization runs smoothly.

DAO are fully autonomous, independent, uncontrolled and transparent because they are built in blockchain therefore anyone can view their code.