Decentralized autonomous organizations, or DAOs, are a new type of company that operate without any form of traditional management.
Fundraising is one of the key features of a DAO. A DAO can issue tokens that represent shares in the company. These tokens can then be traded on cryptocurrency exchanges.
Other features of a DAO include:
-Decentralized governance: Members vote on decisions made by the DAO using blockchain technology.
-Automatic execution: The code behind a DAO is executed automatically, without the need for human intervention.
-Flexibility: A DAO can be programmed to do anything that its creators desire.
DAOs are powered by cryptocurrency tokens which give holders voting rights and the ability to make proposals. Funds are raised for a DAO through a process called token sale or Initial Coin Offering (ICO). In an ICO, investors buy tokens with ether (the native cryptocurrency of the Ethereum network) and receive them in return. The DAO’s funds are held in a smart contract and can only be used to finance proposals that receive approval from a certain number of voters.