DAOs with superpowers: embrace real decentralization with the Internet Computer Protocol
What are DAOs? DAO stands for “Decentralized Autonomous Organization”. Simply put, it's a self-governing body that can be achieved through blockchain technology.
“A DAO, or “Decentralized Autonomous Organization,” is a community-led entity with no central authority. It is fully autonomous and transparent: smart contracts lay the foundational rules, execute the agreed-upon decisions, and at any point, proposals, voting, and even the very code itself can be publicly audited.”
DAOs are defined by the following characteristics:
• Decentralized: there is no central authority over the platform running the governing code. Decisions are made by community members.
• Autonomous: once a DAO structure is in place, there is no need for external intervention to keep it running.
• Self-sufficient: resources are collected/allotted through smart contracts, and changes can only be made via a DAO's community consensus.
DAOs on the Internet Computer vs. Ethereum
DAOs are organizations defined by code, typically governed with tokenized voting that not only controls digital assets in a DAO's treasury, but the management of smart contracts as well.
There are many similarities between DAOs built on Ethereum and those built on the Internet Computer. However, a key difference is that Ethereum DAOs cannot natively control front-end of dApps. This is because Ethereum DAOs cannot be built fully on-chain, and products built on Ethereum cannot interact natively with external systems and other blockchains.
However, DAOs built on the Internet Computer Protocol can be developed full stack on the blockchain, superpowering the known DAO framework! The limitations of Ethereum, or any other blockchain currently in existence, simply won't be an issue for Internet Computer DAOs.
Since the dapps oh the Internet Computer are 100% on-chain, both back-end and front-end, the DAO is able to control dApps and interact with external systems and chains, thanks to integrated HTTPS calls & ECDSA.
The Internet Computer Protocol is governed by a DAO: the Nervous Network System (NNS)
While the Internet Computer Protocol blockchain is being developed by the DFINITY Foundation, the NNS (Nervous Network System) plays a significant role in governance and guiding the developments being made. The NNS is the largest functioning DAO in existence, both in number of participating members and TVL (total value locked).
The NNS is an open algorithmic governance system. It has created notable innovations, including the ability to upgrade the Internet Computer Protocol and software running on node machines, onboard new node providers, add node machines into the blockchain network, and create new subnet blockchains to increase capacity.
Anyone can participate in the NNS by staking ICP tokens into one or more neurons. Neurons can submit proposals and decide to adopt or reject them. The NNS also allows a liquid democracy: neurons can follow other neurons to delegate voting power.
It's a lot to take in, especially if you're new to the Internet Computer. You can read more about the NNS in our handy introduction:
The Official Internet Computer DAO Launchpad: the Service Nervous System (SNS)
The SNS is an open tokenized governance system designed to implement decentralized control over a dApp. It is currently under development though expected to launch very soon. The SNS will be provided as a service by the DFINITY Foundation so that DAOs can be built and run full stack from the Internet Computer Protocol blockchain.
It will run structurally similar to how the NNS works, only on a smaller scale. While the NNS is the open governance system of the Internet Computer, the SNS will allow DAOs to control individual dApps.
The NNS, as the ultimate governing body, will have some control over the SNS: Staked Neuron voters will have a say in deciding what projects are legitimate and can access the SNS launchpad. This is a great reason for you to stake your $ICP if you haven't done so already!
Once a project is accepted, its decentralized token launch will be live and accessible on the NNS dashboard. Once token distribution is complete, the SNS-created DAO becomes independent from the NNS. At this point the DAO is autonomous, the NNS no longer has any role in governance.
While the SNS isn't live (yet!), you can test out the front end to see what functionalities are coming:
You Are Early.
If you’re interested in creating a DAO on the Internet Computer, congratulations. You’re early. The SNS debut is closer than ever, and if you're reading this you could very well be one of the first DAOs to launch through this innovative new platform.
Keep an eye on Dfinity Community and don't forget to subscribe to our newsletter! That way you'll be the first to know when the SNS goes live.
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