The decentralized nature of DAOs and their dependence on vibrant, committed communities can be at odds with investors who are just in it for the virtual Benjamins.
A growing number of Ethereum enthusiasts believe that decentralized autonomous organizations (DAOs) could be the future of work, cultural communities and human organization. As such, some think that DAOs, like decentralized finance (DeFi) and non-fungible tokens (NFTs) before them, are due for a mainstream breakthrough.
On a basic level the thesis makes sense. After all, DeFi took off on the idea that it’s the inevitable successor to the traditional financial system while NFTs are soaring on the belief that they are the digital generation’s art world. So why shouldn’t DAOs, with their rules of organization programmed transparently onto blockchains, have their moment as they seek to replace the outdated hierarchical structures of centralized corporations?
Unfortunately, placing a bet on that trend playing out isn’t as cut and dry as buying some tokens.
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