A decentralized autonomous organization (DAO) is a type of organization that is governed by a set of rules encoded in smart contracts on a blockchain. These rules define how the DAO operates and how decisions are made within the organization. In general, a DAO operates as follows: Members of the DAO participate in the organization by holding tokens, which represent ownership in the DAO and give them the right to vote on decisions. Proposals for actions or decisions are made by members of the DAO and are put to a vote. Members of the DAO cast their votes by sending a transaction to the DAO's smart contract, which counts the votes and determines the outcome of the vote. If the proposal is approved by a majority of the members, the smart contract executes the action or decision specified in the proposal. The DAO's smart contract tracks the organization's assets and records all transactions, ensuring that the DAO operates transparently and in accordance with its rules.