Introducing our new DAO overlords

In less than a month, the DAO has officially become the most successful crowdfunding campaign in history, raising nearly than 11,000,000 Ether; or $130,000,000 USD.

What is the DAO?

The DAO, or Decentralized Autonomous Organization, is a leaderless venture capital fund which relies on smart contracts for voting, distribution, and profitable gains.

Users join the DAO by purchasing tokens, which give them status within the community. Each token represents a proportional vote, which can be used to help decide which projects the DAO will fund. The more one invests, the more power they have to influence the community.

As money flows into invested projects, a percentage of every transaction is sent back to the DAO and its token holders. Participants vote on what percentage of these funds should become profit for individual users, and the amount that will be returned to the DAO's prime address, to be used by future proposals.

The DAO anoints contractors to carry out chosen projects, delivering payment for services rendered on a schedule. This allows the DAO to cut off inactive or exploitative contractors at any time, should they fail to follow the wishes of the crowd.

Should a token holder decide to leave the DAO, they may recoup any investment which has not already been committed to a proposal. Pledged coins will continue to profit from the success the projects they fund, even once the token holder has left the DAO.

After the first 15 days of the sale, the token price increases each day until the end of the campaign. Users who invested early received 100 DAO tokens per 1 ETH. Users waiting to participate until the final days will pay 1.5 ETH per 100 DAO tokens. Tokens purchased after the initial 15 days will not be refunded 1:1.

Curators

The DAO is not 100% code, there are cases where humans get involved. Ten Curators are nominated by token holders. These Curators can be hired and fired at any time, for any reason by a democratic vote. Curators' only two functions are to make certain that contracts published on the blockchain match a contractors claims, and to control the whitelist of contractors able to receive Ether from the DAO. Curators do not evaluate proposals, audit smart contract code, provide legal advice, or take responsibility for any proposal therein. They are a type of final fail-safe in case there is an attempted attack on the DAO.

The Proposals

There are two proposals which are ready for consideration.

Slock.it: a digital lock company which allows it’s users to rent, sell, and share spaces or items autonomously using the Ethereum Blockchain. In addition to submitting the first proposal, the Slock.it team are also the creators of the DAO.

Neither their team, nor any individual, has control over the DAO’s war chest, however. Their status as the progenitors of the DAO offers no guarantee that their proposal will be accepted, if the community does not wish it to be so. There is also Mobotiq: a company specializing in modular electric vehicles that can be rented P2P. The Mobotiq proposal has not yet been released for public scrutiny.

The Future

It is estimated that the DAO currently holds more than 30% of all existing Ethereum. In seventeen short days, it has become the most successful crowdfunding campaign in history. It is likely to set and break its own records many times over, during the ten days that remain.

The digital currency community is once again entering uncharted territory. It is important that we embrace the changing tides with a willingness to adapt, and to improve. Questions of how such a fund will be governmentally regulated, and whether the project will ultimately be met with success, abound.

It is comforting to know, however, that the most common question asked of the DAO is also the easiest to solve - What will the community do with the fortune we now control?

The answer is, simply, that we can do anything.