What Is a Decentralized Autonomous Organization (DAO) and How Can It Govern a Derivatives Protocol?

A DAO is an organization represented by rules encoded as a transparent computer program, controlled by its members, and not influenced by a central government. In a derivatives protocol, the DAO's members (who hold governance tokens) vote on key decisions.

These decisions include setting risk parameters, adjusting fees, approving smart contract upgrades, or even choosing new oracle providers. This ensures the protocol is decentralized and resistant to single-point failure.

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Can an Oracle Be a Decentralized Autonomous Organization (DAO)?
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Glossar