
The DAO close to $100m in funding. Soon to be the largest crowdfunding ever - no_gravity
http://daohub.org
======
fefe23
This is a good example of a completely useless web page. What is a DAO? Why
should I care? Who is running this? Is this a for-profit enterprise? A non-
profit? An NGO? A performance art collective?

> The DAO’s Mission: To blaze a new path in business organization for the
> betterment of its members, existing simultaneously nowhere and everywhere
> and operating solely with the steadfast iron will of unstoppable code.

This is meaningless to me. It means nothing.

When I see web pages like this, I wonder how people can waste money on web
pages like this. All style, zero substance.

This could be "social experiment" by a bunch of pot smoking college students
in a dorm somewhere, for all it speaks to me.

~~~
splintercell
The DAO is essentially a 'Smart Contract' (read: a computer program which runs
over the blockchain) between the willing investors to collectively fund
various projects (in exchange of a certain return).

People are investing in this because they want to participate in the future
blockchain/non-blockchain projects which will seek funding from the DAO.

Others can submit proposals to this smart contract, and community can vote on
it (in proportion of their investment).

~~~
kang
There are non-smartContract program that run on blockchain. That is not what a
smart contract is.

~~~
killerstorm
A concept of a 'smart contract' isn't well-defined, thus it's hard to tell if
something is a 'smart contract'.

But programs which run on Ethereum blockchain are officially called contracts.

------
chamza
I agree that the website is terrible. Over the past few weeks I've dug deep
into it and think it is a really awesome experiment, although a very risky
'investment'. I will attempt to explain it below:

The DAO is a group of people putting together their money to manage it and
make more. This is done through proposals and members voting on passing them.

Based on the proposals that are accepted, the DAO can be anything really: a
hedge fund, VC fund, lottery-system, gambling pot, etc.

What it becomes is still undefined and we can only see with time based on
proposals and how the members vote. That alone is really interesting and
exciting to me: will members actually make intelligent decisions or will it
crash and burn?

The DAO also shows the power of the underlying crypto, Ethereum, on which this
was built.

~~~
tonyswish
I agree completely.

I'm a part of a different project on Ethereum (Augur) and we went out of our
way to simplify everything so that anyone, regardless of sophistication can
understand. We had the first big crowdsale on the platform and did quite well
in a very bear market, I credit much of that to simplifying the idea as much
as possible.

This is a huge problem with Ethereum projects as there are so many cool ideas
but they are so developer-centric that they lose anyone with unnecessary big
words and weird language.

With all that said, the DAO seems to be a very cool project and has found a
huge level of success with this major flaw, which says something. I just
wonder what they could be doing if the message was something that could be
figured out by a newbie in under 3 minutes.

------
toddkazakov
I went to their website, read a few pages of the content, and I still have no
idea what is this and why they're close to $100MM funding.

~~~
rhizome
Makes you wonder who is contributing the 100MM and how they know what they
know.

~~~
jaredtobin
I contributed, and I know what I know by virtue of playing with the
technology, keeping up with the news in r/ethereum, etc. The usual kind of
thing one does in smaller tech communities.

~~~
zeven7
Same here. For those who have been keeping up with Ethereum developments, the
DAO has been in the works for a long time, and people already have a general
idea of what it is. There's been a lot of previous discussion about it dating
back years[1].

I think the problem with the website is the people who created it are so deep
into this stuff that they think it does a sufficiently decent job of
explaining it. They've forgotten just how much of a learning curve there is
for someone outside of the Ethereum community, much less anyone unfamiliar
with blockchain technology. They may have not even planned for the website to
explain it to such people, thinking they would be uninterested or unable to
figure out how to participate anyway.

[1] [https://blog.ethereum.org/2014/05/06/daos-dacs-das-and-
more-...](https://blog.ethereum.org/2014/05/06/daos-dacs-das-and-more-an-
incomplete-terminology-guide/)

------
zaroth
DAO stands for 'decentralized autonomous organization'. 'TheDAO' is an
instance of a DAO, in this case their stated mission is to fund various
projects related to IoT and the sharing economy that its members vote for.
Apparently this is for-profit and proposals are expected to provide some kind
of ROI, perhaps financial returns or physical delivered product.

Ethereum provides the decentralized infrastructure to support the voting and
disbursement of funds from 'TheDAO' to the winning proposals. I don't know
enough about ETH to understand the high level view of how it really works. It
seems like all the websites devoted to Ethereum/DAO write in this entirely-
devoid-of-substance style which is so breathless about how much it will change
the world, it can't seem to actually tell you what's really going on.

Crucially, I'm not sure it's quite fair to describe this as $100m in funding.
You can get your share of ETH back at any time, minus amounts that have been
committed to approved projects. Ethereum must somehow guarantee this
property.... It is amazing what a large percentage of all ETH (currently
stands at 13%) has been committed, but I assume the refundable nature of it
all is what's driving such large involvement.

One thing I found interesting is that the first 'Proposal' on TheDAO is for
Slock.it, which itself is run by a team which was highly involved in starting
Ethereum. If you read Slock.it and try to understand what they are doing, you
will find it's exactly like trying to read and understand TheDAO -- so many
words which just totally fail to make any kind of discernible point.

[1] -
[https://daostats.github.io/tokenvol.html](https://daostats.github.io/tokenvol.html)

------
ddxv
I clicked, read the webpage, went back to HN for an explanation in the
comments. Unfortunately there just other human beings as confused as I am.

So I googled it and found this: “decentralized autonomous organizations”
(DAOs) [https://blog.ethereum.org/2014/05/06/daos-dacs-das-and-
more-...](https://blog.ethereum.org/2014/05/06/daos-dacs-das-and-more-an-
incomplete-terminology-guide/)

The way I understand it, it is for building an organization that is somehow
"autonomous" and decentralized. I put the autonomous in quotes because I am
still not sure what that means, though I understand the decentralized part.

Two other descriptions, from slightly skeptical observers, were: Decentralized
Corporation Decentralized Venture Capital

~~~
killerstorm
Autonomous means that it is able to act on its own.

E.g. suppose that at some point organization members decide that it should pay
do monthly payments to some address to pay for certain work. A DAO noted this
decision and started to execute it.

At a later point members might change their mind, they no longer want this
payments to be made. But DAO will keep making them if there is no way for
members to cancel this execution.

Thus DAO members do not have a complete control over the thing. It is
autonomous.

~~~
greenrd
That's a hypothetical though, I'm guessing. Does The DAO actually use
uncancellable payments, and if so, what for?

------
ivoras
Ok, I have read the page at [https://daohub.org/](https://daohub.org/) and I
still don't know what "the DAO" is?

Is it a blockchain-centred crowdfunding platform?

~~~
splintercell
> Is it a blockchain-centred crowdfunding platform?

Yes. It's a blockchain powered crowdfunding platform. Except it isn't just a
medium to pre-order cool projects online(like Kickstarter is).

~~~
kang
No this is not crowdfunding over blockchains. This is just someone putting up
an address to collect money and issuing homemade tokens.

~~~
zeven7
Haha, you really think that's _all_ it is and they were able to convince
people to send them $100 million to that address?

------
typeIIA
Based on existing proposals, the DAO offers a new type of investment
mechanism.

Regular crowdfunding allows accredited as well as non-accredited investors to
lock their money in with a start-up in exchange of various type of securities
(preferred equity/convertible debt etc...). In this scheme the investors have
most of the time absolutely 0 liquidity to exit their investment until the
start-up goes public.

The DAO proposals in contrast offers a revenue sharing proposition. The
startup can receive a lump sum or stream of payments in exchange for a promise
to execute on their business plan. Once the company gets revenue (on the
blockchain) a piece of it (like 1%) will be redistributed to token holders (as
a form of dividend if you want).

In contrast to illiquid/bottom line offer available in regular crowdfunding
platforms, the DAO offers a topline/liquid investment. The liquidity comes
from the fact that although the DAO technically "locks" its investment with
the startup, the DAO token themselves are a tradeable assets which can be
exchanged against other cryptocurrencies (BTC mainly) as soon as the DAO is
officially created.

In this light the DAO is akin to some kind of decentralized investment firm
because the token holders are not directly owners of any share in the
beneficiary business. On the other hand it is a transparent investment firm
because no portfolio manager takes discretionary decisions about which startup
funds will be allocated to.

the fund allocation logic is organized as "proposals" that can be voted in a
secure and transparent fashion on the ethereum blockchain through a smart
contract.

hope this clarifies some aspects of that project!

------
natch
This is just bonkers:

>By Creating DAO tokens through interaction with The DAO’s smart contract
code, you expressly agree to all of the terms and conditions set forth in that
code. If you do not understand or do not agree to those terms, you should not
Create DAO tokens.

They are saying you need to fully understand all the code, in order to
responsibly decide whether you should click a button. But the code is off
somewhere else, with no links to it in the shrink-wrap license. For all I know
some of the code is buggy or impossible to understand. How many people putting
in money have read all the code before doing so? Does all the code even exist
yet? Are they agreeing to contracts now that will be hammered out in the
future, by a democracy? Tyranny of the majority, anyone? Tyranny of the
majority enforced by code sounds even more scary.

Then:

>The use of The DAO’s smart contract code and the Creation of DAO tokens
carries significant financial risk, including using experimental software.

The risk part I get, that's pretty standard. But I'm to agree to abide by
contracts set out in code I can't see, probably can't understand, and running
in experimental software?

What could possibly go wrong?

~~~
pdaian
The code is here:
[https://github.com/slockit/DAO/blob/master/DAO.sol](https://github.com/slockit/DAO/blob/master/DAO.sol)

Also pretty much entirely contained in the whitepaper.

~~~
natch
The fact that you can post a github link here tells me nothing. And that code
is atrocious, but that isn't even the point. The point is there's no way
people are vetting this code that they are signing up to be bound by. It's
utterly insane to hand money over to this thing.

------
donaldmcintyre
However crazy, and whatever happens to this specific DAO, this is a
breakthrough event in computer science and human organization IMHO.

------
aerovistae
Anyone who can explain what this is, much appreciated. Judging from comments
here I'm far from the only one without a clue despite reading the page.

~~~
znt
I think DAO is a complicated abstraction layer over blockchain protocol,
meaning that when you get hacked you don't know how much money you actually
lost.

~~~
sopooneo
That sounds about right to me. Any insight on how it/they managed to get 100
million in funding? What do all the people sending money _think_ "DAO" is or
does?

~~~
znt
It says "107.21 M USD EQUIVALENT" without any evidence. I highly doubt that
amount is legitimate.

Or they may be laundering money as well, I wouldn't spend too much time
thinking on this.

~~~
simondlr
It's done by taking the amount of Ether it has already raised * the current
price of Ether. See it transparently on the Ethereum blockchain:
[http://etherscan.io/token/TheDAO](http://etherscan.io/token/TheDAO)

~~~
revelation
So yes, not $100M at all. The market for Ether is about as liquid as that for
my own imaginary currency.

------
fraserharris
DAO stands for Decentralized Autonomous Organization. This seems to be an
experiment in democratic group action.

The "process" is: the community approves or declines plain English Proposals
backed by smart contract code aimed at building products or services for the
benefit of its members. All operational elements are programmed into the
Proposals submitted by Contractors. The Proposals submitted will give day-to-
day operational control over to the Contractors, while enforcing strict
payment schedules executed in predefined instalments.

------
songzme
I was confused as to what the DAO is, so I googled around and came across this
article that explains it pretty well: [http://www.coindesk.com/the-dao-just-
raised-50-million-but-w...](http://www.coindesk.com/the-dao-just-
raised-50-million-but-what-is-it/)

~~~
NotSammyHagar
Ethereum lets you have simple scripting over ethereum transactions, and I
think Slock.it is an meant to be a "locking mechanism" on top of that, so one
can only guess (because they have no-info web pages too, just like dao!), that
this is a more comprehensive and sophisticated block chain programming model
and higher level services than ethereum, but I can't really tell for sure.

------
stevecalifornia
Where is the evidence of $100M?

~~~
simondlr
It's all completely transparent on the Ethereum blockchain. No other middlemen
holding any funds, except the code.
[http://etherscan.io/token/TheDAO](http://etherscan.io/token/TheDAO)

------
adrianbg
Is this a cult?

~~~
linagee
Only in so far as a traditional company, like Apple, might be a cult.

------
jgh
why does this read like Zombocom?

------
strgrd
> Each DAO Token Holder is granted voting rights and complete control over The
> DAO's digtal assets (ETH to begin with) proportional to the amount of DAO
> tokens they hold.

It seems like they're going to raise a bunch of money, and then vote on what
to do with it. The premise I guess is that it's a "distributed autonomous
organization" but I imagine the initial investors have a large stake in the
amount funded so far, and their politics will decide what happens to the
majority of investors who hold virtually no votes in comparison. This seems
like a certain type of investment scheme...

~~~
simondlr
Who are the initial investors? There's no privileged position.

------
olh
Wikipedia to the rescue (give or take):
[https://en.wikipedia.org/wiki/The_DAO_(organization)](https://en.wikipedia.org/wiki/The_DAO_\(organization\))

~~~
linagee
If you're still trying to figure it out, this is what "The DAO" is, in
programming code. No more, no less. Money in, wonderful things out. :) It will
seem like magic to most.

[https://etherscan.io/address/0xbb9bc244d798123fde783fcc1c72d...](https://etherscan.io/address/0xbb9bc244d798123fde783fcc1c72d3bb8c189413#code)

------
chejazi
_A DAO_ is a Decentralized Autonomous Organization. Participating in the
governance of a DAO can happen from anywhere that can read/write to the
blockchain, and the rules are autonomously enforced across all participants
because they are encoded in the blockchain.

 _The DAO_ is a DAO specifically designed to raise money for other DAOs. The
unique thing about it over other crowdfunding platforms is that voting rights
are implemented in an Ethereum contract hence enforceable with no central
authority.

------
vasaulys
So DuckDuckGo gives their site description as being "the first Decentralized
Autonomous Organization on the Ethereum blockchain" for those who are curious.

But my God, that site is horrendous.

------
pen2l
That's pretty impressive; especially for something I have never heard of
before or even understand still what it is about.

------
grifffgreeen
What is a DAO... ? What is The DAO? It is answered really well in this
interview:
[https://www.youtube.com/watch?v=Pn_7fdmfZY8&feature=youtu.be...](https://www.youtube.com/watch?v=Pn_7fdmfZY8&feature=youtu.be&t=348)

------
fraserharris
DAO stands for Decentralized Autonomous Organization (that's as far as I got)

------
cordite
I got way more information out of the title of the white paper than the twenty
minutes I spent scanning this website. Automated governance is what I needed
to get a handle on what this is.

------
nerboda
You not understanding something != It doesn't make sense

------
thomasfoster96
My best guess is that this is the cryptocurrency version of brownie points.

Other than that this is the most information sparse webpage I've visited for a
long time.

------
ZenoArrow
All I understood from that page is that it has something to do with the
cryptocurrency Ethereum. Is it an Ethereum coin exchange or something like
that?

------
kuschku
So, kinda like a cooperative, but based on a cryptocurrency? I’m not sure I
understand it, my buzzwordish is a bit rusty.

------
ChuckMcM
is DAO an acronym? "Does Anyone Object" ? "Diabolical Ant Organization"?
"Donuts And Onions" ?

This web site reads like some of the really bad TEDx talks "its going to
revolutionize the world" but what it is, well that is a mystery.

------
street
[deleted]

~~~
ZenoArrow
Thanks for the explanation. Sounds like a Ponzi scheme to me. Is there any
independent site that verifies how much funding they've already got?

~~~
street
[deleted]

~~~
rhizome
Telling deletion

~~~
ZenoArrow
For what it's worth, street's response was in the form of a joke, I wouldn't
read too much into the deletion.

------
asadimatsu
this should help you guys understand it a bit better.

[http://www.chicagotribune.com/bluesky/ct-crowdfunders-
decisi...](http://www.chicagotribune.com/bluesky/ct-crowdfunders-decisions-
venture-capitalists-20160514-story.html)

the DAO is basically a decentralized kickstarter that for now, is going to
invest in blockchain startups, but it can fund whatever it wants :D

