why-you-need-a-dao.md

description
(still under construction)

Why and when do you need a DAO

Use DAO

1. If you want to formalise interactions between different actors in code instead of using written contracts: ****"We will pay you $100 for this task. If we don't agree, then you should go to court" -> "We put $100 in the escrow, and we have a Dispute Resolution mechanism in case something goes wrong"
2. If you want to add incentives/penalties to balance the process and eliminate asymmetry: "If you don't attend the meeting, you should feel sorry" -> "If you don't attend the meeting, then your stake is burned"
3. If you need to effectively govern some resource collectively;
4. If you want to process/work with crypto and tokens directly;
5. If you need to add transparrency. As a result, one can verify that protocol is applied correctly (finances, votings, decisions, etc);
6. If you need to protect actors from the centralised management;
7. If you need to reduce possibility of censorship.

As a result

• DAOs lead to better decision making: easier, done faster and more verifiable;
• DAOs can help you build entirely new business models;
• DAOs can reduce costs;
• DAOs can help you raise capital and control it.