What is the meaning of holding a governance token?

If you have interests in the crypto industry, you often hear about governance tokens. Some people say it is the next trend. Some people say DAO is only for a social club. What is your take on this? Let’s go over the things that are essential parts of DAO.

What is DAO?

the literal meaning of DAO is Decentralized Autonomous Organization. It means a community-led organization without any central authority. Why is it important to form an organization without a central authority? It goes beyond the definition of DAO. What we are trying to achieve in the web3 world is full authority for every user.

Why is DAO important?

Let’s think about the web2 world to compare with web3. We upload the video on Youtube. It seems it’s our property. But it’s not. If they want to take your video down and shut down your account, there is no way of stopping them. It’s no one’s fault. It’s how it has been.

Web3 is now changing the world. One of the essential parts of the web3 is the authority for all users. You can now own the drawing as your own. You can own the music as your own. No one has the right to take your property away from you. But we still need community and a platform to actually create value for the world. That’s DAO. The missing piece towards the full decentralization.

How does DAO works?

You can imagine it’s pretty much the same with the traditional voting system. Some users propose ideas and other users vote on their opinions. But we haven’t determined many of the functions and how far the DAO has to cover. It’s also a big question to solve for all of us.

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