The Top 5 DAOs You Need to Know
Unlike your typical organization, every member of a DAO has voting rights. And this democracy makes DAOs very popular among Web 3 users, who are heavy advocates of decentralization. They shift away from centralized decision-makers.
A traditional company structure generally follows a traditional template. At the very top the executives are seated. They make all the decisions and have complete power over the company. The more you descend in hierarchy, the less decision-making power you have.
This is the complete opposite of a decentralized autonomous organization (DAO). Unlike your typical organization, every member of a DAO has voting rights. And this democracy makes DAOs very popular among Web 3 users, who are heavy advocates of decentralization. They shift away from centralized decision-makers.
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At its core, a DAO is an internet-based organization with no central leadership or authority. The members are anonymous and each one can vote on the future of the organization. Every move of a DAO is collectively decided and agreed upon by its members. Then, all actions and operations of a DAO are executed by smart contracts.
DAOs can be built for different purposes, including fundraising, charity, and investments.
If you’re considering DAOs, here are five organizations that should be on your radar.
One of the most popular DAOs, Uniswap, is on a mission to solve the liquidity problems faced by decentralized exchanges. To do so, it built a protocol that creates token swap markets, which any person, wherever they are in the world, can access and use.
Uniswap launched its governance token UNI in September 2020. Any UNI holder is considered a member of this DAO, which means they can submit proposals to change the protocol and vote on these proposals. Besides the governance of the DAO, UNI token holders can also vote on the UNI treasury, liquidity tokens, and any protocol fees.
In May 2022, Uniswap hit the $1 trillion trading volume milestone, just three and a half years after its launch. To date, Uniswap enjoys a market cap of over $2.5 billion and sees 24-hr trading volumes of over $100 million.
ApeCoin is new to the digital currency game, only entering the cryptocurrency scene in March 2022. However, it already enjoys a lot of support because of its affiliation with the Bored Ape Yacht Club (BAYC), one of the most sought-after and most expensive NFTs. If you own ApeCoins, you become part of the ApeCoin DAO.
Like many DAOs, the ApeCoin DAO employs a system of proposals and voting to govern the organization and decide how to allocate its funds. The ApeCoin DAO currently has a market cap of over $82 billion and sees daily trading volumes of over $160 million.
Aave is part of the decentralized finance (DeFi) space. True to the DeFi vision, Aave’s goal is to build an open-source and secure platform on the Ethereum blockchain, where people can access financial services, regardless of location or identity. Governance and power are distributed through AAVE tokens. If you hold or stake AAVE tokens, you have a say in how the organization is run.
Apart from voting, token holders or stakers can submit proposals, where they suggest any improvements or changes they hope to see on the platform. All the members then deliberate and vote on these proposals.
Aave is a fairly popular DAO, with 24-hr trading volumes that surpass $300 million. It also boasts a market cap of over $958 million.
The vision of MakerDAO is to create a financial economy that is stable and accessible to all. Its goal is to level the playing field so that anyone can access their platform and reap the benefits of digital money.
It is no surprise therefore that unlike other DAOs, MakerDAO employs a combination of on-chain and off-chain voting procedures. DAOs that use on-chain voting restrict voting to token holders. MakerDAO, on the other hand, also allows anyone to participate in off-chain voting even if they don’t hold the native MKR tokens, as long as they’re part of the community forum.
MakerDAO members enjoy using a price-stable currency and a fast-growing ecosystem. Its daily trading volume exceeds $200 million, and its market cap is well over $6 billion.
SushiSwap is a fork of Uniswap that allows for peer-to-peer cryptocurrency transfer. Users love it because they can exchange digital currencies without intermediaries or middlemen, which makes the process faster, easier, and more cost-effective. To date, you can swap between 11,700 currency pairs on Sushiswap.
Like MakerDAO, Sushiswap also employs off-chain voting. It relies mainly on an off-chain system. Voting takes place on Snapshot, a decentralized voting platform. When a user wants to propose a change, they submit a proposal to the community forum. If the proposal gains enough traction, it will be moved to the voting platform. If a proposal gets 5 million votes, it will be implemented.
Sushiswap’s daily trading volumes reach $42 million, and it has a current market cap of $146 million.
These DAOs are just the tip of the iceberg. There are over 2,000 DAOs listed on DeepDAO.io, of varying purposes and popularity. So it’s important to do extensive research before being part of one.
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