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Blockchain DAO

In Blockchain, the full form of DAO is Decentralized Autonomous Organization. As the DAO full form says, the organization is both decentralized & autonomous. Sometimes DAO is also known as DAC (Decentralized Autonomous Corporation), but the most common name is Decentralized Autonomous Organization (DAO). It is used more often because not all organizations & institutes are corporations.

A DAO is an organization which is represented by rules which are encoded as a laptop or machine program that is transparent. The central govt does not influence it and it is controlled by the shareholder. A DAO is one of the most complex ones, and smart contract .  Let us know what a smart contract is, a smart contract is a computer program or software available on the internet, but it can't perform tasks on itself. It requires someone to perform the task.

It doesn't matter whether you are a robot or a human being in Decentralized Autonomous Organization (DAO). All the rules of DAO are maintained on a Blockchain, including program rules & financial transaction records. We can have multiple combinations of different parties for reaching agreements & exchange value because DAO runs on a distributed network & DAO also runs on a Blockchain. You can have people communicating with people, devices communicating with people & devices communicating with devices.

How does DAO work?

DAO (Decentralized Autonomous Organization) uses smart contracts, which run on rules encoded as a program or software.

A smart contract is an organization that exists autonomously and lives on the internet. The automation program can't perform certain tasks & for that, there are people to perform those tasks to complete the tasks.

Let us understand the working of DAO in Uber:

As we know, Uber is an app by which you can arrange a cab for yourself by calling & sending your location using the Uber mobile app. Once you confirm your location & destination, a come to pick you up and drop you at the particular location (destination). This entire process is run on a mobile application. But this involves the human component (i.e., the driver who comes to pick you up and drop you off).

But if you use artificial intelligence, there is no point in using a driver to come up & communicate with you. As the technology improves day by day, a car can be automated, and ai can be implemented in it so that the car comes on its own, picks you up, and drops you to a particular destination. & for the payment process, it can be done on the mobile app itself & the car will interact with you automatically, without any involvement of a human being. & this whole process can be created using DAO (Decentralized Autonomous Organization). But this doesn't imply that you need to replace the whole thing with a laptop. You can have a distributed network that consists of human beings & these human beings will reach these arguments based on smart contracts.

Comparison between DAO & traditional organization


  • DAO is usually fully democratized & flat.
  • For any changes made in DAO a, voting is conducted.
  • The outcomes are implemented independently without any intervention from a trusted intermediary.
  • All the services there are handled automatically & in a decentralized manner (e.g., philanthropic fund distribution). All the transactions are completely public & transparent.

Traditional organization

  • Traditional organizations are usually hierarchical.
  • Changes can be demanded or made from a complete party or by voting, which is offered & this all can be done based on the structure of demand.
  • The outcome of votes is handled manually; they are internally tallied if the voting is allowed.
  • It requires centrally controlled automation or human handling, accessible for manipulation. Activity is limited to the public & typically private.

Two parts of Blockchain


A header consists of the previous block hash value to maintain or continue the chain integrity. It also contains a hash of the present block body to the integrity of transactions data, blocks no., nonce, a timestamp, the address of the Blockchain & who has created the block, & some more information requested.


A body contains a minimum of one transaction, and the maximum can be any transaction in a particular block of a body.

There were 3 things that the internet was unable to do, or the internet was not designed that way, but Blockchain technology fixes them all. The 3 things are as follows.