<aside> 💡 On this page, we will learn about a new type of organizational structure powered by the blockchain.
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Before diving into Decentralized Autonomous Organizations (DAOs), it’s crucial to understand the problems they aim to solve.
This system has resulted in a challenge that affects nearly every industry and organization: the principal-agent problem.
This issue arises when a person or entity (the principal) has conflicting interests, goals, or priorities with those who make decisions and act on their behalf (the agent).
Examples of this situation include when a CEO (agent) does not make decisions that best align with shareholder (principal) interests or when a trader (agent) uses high leverage to chase a performance bonus, knowing the company (principal) will cover any losses.
Made by Rohan Hirani