An Overview of the DAO's Core Features
In general terms, decentralized autonomous organizations (DAOs) are member-owned and blockchain-based communities without centralized leadership. Top-down management is replaced by blockchain rules encoded in their specific smart contracts.
DAOs rely on the blockchain technology to provide a secure digital ledger for their members to have a transparent overview of all its interactions and timestamps. This approach eliminates the need to involve a mutually acceptable trusted third party in any DAO proposal or transaction.
In the eckoDAO, proposals are drafted by its DAO members. Original ideas are published on the eckoDAO website for the community to see and discuss. Ultimately, the community votes on implementations (voting power will be explained later on the docs). This again underlines the DAOs freedom from a central authority. The group takes decisions collectively through a transparent voting system, and payments from the KDX treasury are only authorized when votes pass.
The backbone of these features is the eckoDAO smart contract, which also defines the rules of the organization and holds the group's treasury. The contract could only be changed through the aforementioned proposal mechanism, and after having received approval by the DAO members. Malicious intents acting outside the scope of the code’s rules and logic will automatically fail.
There are several benefits of a DAO structure:
- Decentralization. In a traditional company, a CEO works with executives to set the direction, budget and hands priorities down the organizational chart to be implemented. In the eckoDAO, members act as peers, contributing capital, proposing and working on projects and making decisions as a group. Proposals impacting the organization are voted on by the community, therefore decentralizing authority across a vastly larger range of users.
- Participation. Individuals within an entity may feel more empowered and connected to its mission when they have a direct say and voting power on all matters. People can also contribute to the eckoDAO full-time or part- time. However, “bounties” (small dedicated projects) are one of the most common ways to hop in and out of the DAO, taking on small tasks and contributing to the extent required and possible.
- Transparency. Within the eckoDAO, proposals, votes and interactions are cast via blockchain and made publicly available to its community. This encourages users to act in the interest of the DAO and in the way they feel is best. Benevolent actions are incentivized (users are facing reputational risk) and at the same time, acts against the community are discouraged.
- Community. The eckoDAO encourages people from all over the world to seamlessly come together to build on a single vision. Moreover, while the success of a more traditional company is accrued within a few founders, early employees and investors, a DAO structure gives a wider group of people the opportunity to own a piece, participate in management and share in the potential upside.
Ultimately, eckoDAO will have the potential to increase economic opportunity and allow more people to benefit in many different ways from their participation within the community, through firmly and securely defined rules based on equality, fairness and transparency.
Alongside the structural benefits of operating through a DAO, there is also a fundamental and unique rational that drives the concrete functioning of the entire ecosystem: a proprietary time-safeguard.
Ever since the development of the first DAOs, the main issues have been revolving around prevention of ill intent by malicious actors within the communities. This becomes even more relevant in completely decentralized and autonomous settings, where no central authority can intervene to stop possible threats. In various cases, malicious users have been able to pre-emptively buy and accumulate enough native token to skew or even reach undisputable majority over the proposals within the DAOs voting processes. Intuitively, this can have disastrous consequences, possibly leading to draining of DAOs funds or worse: “self-destruction”.
eckoDAO has implemented a multi-layered safety feature that bases the members voting power on a combined function of token amount and staking time: the so-called quadratic formula (for more information, refer to the paragraph below). This prevents any possible easy manipulation of individual voting power. Additionally, innovations on the structure through DAO members allows users to take charge of evaluating the reliability of its own participants, through a system of community roles, empowering users to act in the real interest of the whole ecosystem.
eckoDAO combines technical knowledge and security features through the empowerment and uplift of its own community. Any modern organization, no matter how advanced and innovative the solution might be, is still governed and managed by its human element. Technology can only bring truly disruptive innovation when the people behind the project align their interests and goals towards improving the entire ecosystem. This is the core of the eckoDAO strength, that elevates the DAO playing field.