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The concept of a DAO challenges the traditional norms and revolutionizes our ways of life. It is still in early development but more and more DAOs have been founded with various purposes. Before you jump to comment on DAOs future workabilities, you’d better know how many kinds are there for now.
This is the most common type of DAO. DeFI platforms are often managed by a Protocol DAO. The largest decentralized exchange running on Ethereum, Uniswap, is an example. Founded in September 2020, the platform has its own coin UNI, with which members can vote for any move or changes of the protocol.
Similar to traditional venture capitals, an Investment DAO works with a pool of capital but it is not the CEO who can decide which projects to invest in. Instead, the token holders would determine through a voting system that was encoded in the smart contract. Plus, owning more tokens sometimes does not mean more voting power. In some DAOs, it may depend on the members’ contribution to the project or degree of participation.
A global group of Ethereum supporters founded The LAO and interestingly The Lao has registered as a LLC in Delaware, US and of course is compliant to the US law. However, as a member-directed investment capital fund, The LAO carries out all the functions running on decentralized App and smart contracts.
Structured similarly as Investment DAOs, Collector DAOs however are looking for collectible items like NFTs, even physical art pieces and music. One of the most prominent Collector Dao is PleasrDAO, famous for buying the album “Once Upon A Time In Shaolin '' by the Wu-Tang Clan, for US $4 million.
As a sub-DAO of The LAO, FlamingoDAO is another example that focuses on purchasing NFTs and supports the growing Metaverse sector.
Although most crypto supporters put highly attention on capitals, there are groups of people that focus much more on “networking”. For some, blockchain technology connects those people who have similar tastes in life and share common interests and hobbies from all over the world. To enter a Social DAO, users have to own the DAO’s tokens.
Friends with Benefit or FWB consists of a group of Web3 artists and enthusiasts. Likewise, if you consider yourself as one of them and want to join discussions, you have to buy $FWB .
There are Service DAOs, Media DAOs and new types of DAOs may be created later on as the field continues growing and attracting more people to join.