Decentralized Autonomous Organization

Definition ∞ A Decentralized Autonomous Organization, or DAO, is an entity governed by rules encoded as computer programs, often referred to as smart contracts, rather than by a central authority. Decisions are made collectively by its members, typically through token-based voting mechanisms. DAOs operate on blockchain technology, allowing for transparent and verifiable governance processes.
Context ∞ Current discussions surrounding Decentralized Autonomous Organizations focus on their potential to reshape organizational structures and governance models across various industries. Key debates involve the legal recognition of DAOs, their operational efficiency compared to traditional entities, and the mechanisms for resolving disputes. Future developments are anticipated to clarify their legal status and explore novel applications in decentralized finance and community management.