The DAO was a way people could fund projects by being stakeholders. Unfortunately it ended because of contract issues. However, now, a new DAO has been created called Charity DAO which will run completely different than The DAO of the past. Read more about this development in the article below.
The Developers Behind The DAO Are Launching a New DAO
The guys behindare at it again.
The team that created the now-infamous ethereum-based funding vehicle known as The DAO have regrouped, and in a blog post published today, CTO Christoph Jentzsch announced a new open-source initiative called Charity DAO.
The original DAO raised as much as $150m worth of ether by selling tokens that would be used by stakeholders to vote on projects to fund. Yet a then-unforeseen flaw in the DAO’s smart contract was exploited, resulting in a $60m loss and the collapse of the project.
Charity DAO, by contrast, is aimed at making charitable functions more transparent, and if everything works as planned, increasing the willingness of donors to give.
Jentzsch told CoinDesk:
“I want to see a truly decentralized autonomous organization being built on top of ethereum, and a charity DAO is a great application for many reasons.”
Unlike the for-profit DAO, which was intended to pay dividends to investors based on the success of its investments, this effort is intended as a nonprofit. But to prevent even the potential of such high-stakes losses like with The DAO, Jentzsch says this time around he’ll temporarily cap the amount raised and a so-called “security hatch” will be written into the code.
“But long term, I hope this can be removed to be truly decentralized and autonomous,” he told CoinDesk.
Conducted in partnership with a group identified as “Giveth” in the blog, Charity DAO will let donors control their funds and vote on which projects they want to fund.
While this is not formally a product of, Jentzsch says some of the same people who contributed are still involved. Jentzsch is leading the project, but wants to open it up to outside contributors.
The model itself sounds remarkably similar to The DAO, except the recipients of the funds will ostensibly also be nonprofits.
“We want to use the knowledge and the experience learned from this experience to create a Charity DAO,” wrote Jentzsch in the post. “The Charity DAO will have a very narrow focus.”
A second chance?
In the aftermath of the collapse of The DAO, when an unknown perpetrator took advantage by moving $60m worth of funds into an account he or she controlled, the ethereum community suffered immensely.
Charity DAO, as a result, will likely face an intense amount of scrutiny.
In pitching the project in the blog post, Jentzsch argues that “trust in charities is at an all time low” and “charities have a public image problem,” both of which might be hard to swallow for investors who were temporarily burned in the fall-out surrounding the DAO collapse.
But in spite of a call from one member of cryptocurrency academia to ostracize the team from the community, one cannot help but remember the old startup-maxim: fail fast and fail often.
Jentzsch said his involvement with The DAO was “a humbling experience” that highlighted previously unknown factors. He added that it is, perhaps, exactly this experience that helped improve the code used in this current incarnation.
He told CoinDesk:
“I think there is no other smart contract which got more reviews then theDAO contract, and we can use all of this knowledge and feedback to build a better one.”
Image via Shutterstock
Article sourced from: http://www.coindesk.com/dao-developers-launching-new-dao/