A Decentralized Autonomous Organization or DAO is an organization that operates based on rules that are encoded on a blockchain and executed through smart contracts.

DAO’s enable large groups of autonomous individuals to make decisions and work towards a common goal without the need of a formal legal structure or centralized control.

DAOs are typically set up to manage the treasury of a public blockchain network, which can be used to support projects and initiatives that increase adoption of the network. 

One of the most common forms of DAO is a token-based membership model. Under token-based memberships, users only need to hold the DAO’s governance token to vote on key decisions, such as which projects to fund or changes to the governance rules.