Blockchain-Run DAOs As Alternate Source Of Finance? Experts Weigh In

ndtv.com:

DAOs can be used for several purposes but are prominently applied for charities and raising capital.

Cryptocurrency has grabbed global headlines in the unlikeliest ways during the Russia-Ukraine war. Whether the US lawmakers' urge to enact a law to sanction foreign crypto firms doing business with sanctioned Russian entities or Ukraine receiving funds through cryptocurrencies, one such way has been via Decentralised Autonomous Organisations or DAOs.

DAOs, like cryptocurrencies, are powered by blockchain technology. Raj Kapoor, strategic advisor, equiDEI, explains DAOs in a single line: "DAOs are an internet community with a shared bank account where the people use the Ethereum wallet."

As per the Ethereum website, the smart contract defines the community rules of a DAO and no community member can change it except by a vote.

DAOs can be used for several purposes but are prominently applied for charities and raising capital - the former being the case during the ongoing war.

UkraineDAO, a special initiative of musical group Pussy Riot's founder Nadezhda Tolokonnikova, has raised over $6 million by selling Non-Fungible Tokens (NFTs) of the Ukrainian flag. According to its official website, all proceeds from the sale will go to 'Come Back Alive', a non-profit organisation, which is helping the Ukrainian military.

"The case of Ukraine DAO shows that a decentralized structure can be spun up quickly and cheaply and engage with a community around issues of global concern," says noted crypto expert Anndy Lian.

The UkraineDAO project, Lian observes, is an indication of how DAOs are allowing charities to bypass bureaucratic delays and direct funds into the pockets of those in need. "DAOs are more formal means to channel funds and with