Decentralized autonomous organizations (DAOs): pioneering the future of blockchain entities

Written by Clair Wemers Advocaat CMS

Decentralized ledger technology, such as blockchain, enables the establishment of digital organizations that operate entirely or partially on code within a decentralized network. These entities are known as DAOs. The definition of a DAO has been subject to much debate. One can start the journey on defining a DAO with the view of Vitalik Buterin. As one of the co-founders of the Ethereum blockchain, Buterin describes a DAO in the Ethereum Whitepaper in 2014 as a virtual entity that has a certain set of members or shareholders which have the right to spend the entity's funds and modify its code. In the terminology guide on the Ethereum Blog, Buterin describes the idea of a DAO as “… an entity that lives on the internet and exists autonomously, but also heavily relies on hiring individuals to perform certain tasks that the automaton itself cannot do.” He highlights a few elements of a DAO, i.e. a DAO contains some kind of internal property that is valuable in some way, and it has the abi…