This report is a product of, and completely owned by, Galaxy Research. It was originally published as a free PDF here:
DAOs are a tool for organizing communities around a set of shared goals. They are organizations whose rules are codified in the code of a smart contract deployed on a blockchain. Unlike business organizations (like corporations or LLCs) or non-profit organizations (like charities or interest groups) whose rules are codified in a written charter or bylaws, the rules governing DAOs are encoded into the very structure of the organization itself through smart contract technology. What makes DAOs interesting is that they are borderless entities with rules enforced by smart contracts — i.e., they are internet-native organizations run completely on blockchains with no human intervention or central intermediary. In this sense, DAOs mirror the very blockchains that power them, running autonomously in a decentralized, trustless, and peer-to-peer manner. The first-ever DAO, called “The DAO”, articulated this defining principle on the front page of its website: “To blaze a new path in business for the betterment of its members, existing simultaneously nowhere and everywhere and operating solely with the steadfast iron will of unstoppable code.”
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