What is Validation & Quorum?

How Does a DAO Work?

1. Smart Contracts: The rules and decision-making processes of the DAO are encoded into smart contracts, which execute automatically when conditions are met.
2. Token-Based Governance: Members hold governance tokens, which grant them voting rights to influence proposals and changes within the organization.
3. Voting Mechanism: Token holders submit and vote on proposals, with decisions executed automatically based on predefined rules.
4. Transparency & Security: All decisions, transactions, and governance processes are recorded on the blockchain, ensuring full transparency and security.

Why Use a DAO?

• Decentralization: Eliminates the need for a central authority, distributing power among community members.
• Transparency: All actions and funds are recorded on the blockchain, reducing corruption or manipulation.
• Automation: Smart contracts enforce rules automatically, reducing administrative overhead.
• Community-Driven: Members actively participate in decision-making, aligning the organization with its stakeholders’ interests.

What Are Some Examples of DAOs?

• MakerDAO: Manages the DAI stablecoin.
• Uniswap DAO: Governs the Uniswap decentralized exchange.
• The CGS DAO: Empowers token holders to vote on app upgrades, features, and governance decisions.

How Does a DAO Relate to CGS?

The Community Grocery Store (CGS) operates under a DAO structure, allowing users to participate in governance. Token holders can vote on platform updates, fee structures, and strategic decisions, ensuring a community-driven and transparent ecosystem.