The Internet Computer is introducing a DAO in its purest form, eliminating the need for intermediate entities to be in control and putting the community above everything.
Back in 2016, Dfinity’s chief scientist, Dominic Williams introduced his vision of a proper DAO, when he wrote a three-part explanation of how it should look and operate on the blockchain.
And now, a few years later, the Internet Computer Protocol is preparing to launch a system that will allow every dApp on the Internet Computer (IC) to be its own DAO. It’s called the SNS (Service Nervous System) and its go-live date is imminent, with more information coming in the next few days on DSCVR.
To understand how the SNS works, let’s take a look at how the Internet Computer is governed.
The Network Nervous System (NNS)
The NNS is the driving force behind the Internet Computer blockchain. It is governed by its community, which gains voting rights by staking ICP tokens into neurons. The NNS executes decisions and shapes the IC based on the way those neurons vote.
Anyone who participates in the governance of the Internet Computer can receive voting rewards. A token can be locked into a neuron between 6 months and 8 years.
“Once locked, neurons can vote on proposals manually or follow the vote of other neurons – what we call liquid democracy. The longer a neuron is locked for, the more voting rewards it collects”
*Source: internetcomputer.org
The NNS is one of the largest DAOs in existence today. It is a permissionless system, built 100% on-chain.
Learn how to stake ICP here.
What is the SNS (Service Nervous System)?
At first glance, the concept of the SNS is very similar to the NNS. The difference is that while the NNS requires ICP tokens for participation, in the SNS users need a dApp-native token to invest in and govern the dApp, rather than the whole ecosystem.
To put it another way, NNS controls the ICP blockchain and SNS controls the applications on the blockchain.
This concept makes it possible for the users of a specific dApp to be part-owners and to have a say in the direction the dApp is headed.
What Makes an ICP DAO Different From Other Existing DAOs?
Internet Computer DAOs have competitive advantages because they embody the true promise of fully decentralized systems. While other DAOs have only a portion of their Web3 applications governed by their users, the SNS allows full community ownership, where developers and users work together toward the shaping of their products.
The SNS is autonomous. This means that any proposal that has been voted on gets executed automatically, through smart contracts, without the need for an intermediary entity to make determinant decisions.
If you’re interested in learning more or would like to know more about how you can turn your dApp into a DAO, here’s a helpful source.
Why the Internet Computer?
Over the last few years, several spurious attacks from competitors have helped position the Internet Computer Protocol as the world’s most controversial blockchain, as the IC has developed a product that will become a world computer that runs at web speed.
The Internet Computer ecosystem is 100% on-chain, trustless, and infinitely scalable, thanks to state-of-the-art cryptography, which allows an infinite amount of subnets to be combined into one giant computer network.
*Originally published on fastblocks.com