What the heck is a DAO? How to make one?

Harsh Ghodkar
6 min readMar 19, 2022


A lot of buzzwords floating around on the internet. NFTs? Metaverse? DAOs? To The Moon? WAGMI? This article is here to take you on a deep dive into DAOs, just going to need your attention.

Buckle up people, here we GOOO !!

Decentralised Autonomous Organisation ( DAO) is a concept of basically building a democracy with code. With the revolutionary Blockchain technology, we can now code smart contracts. What are smart contracts you ask? Smart contracts are basically promises which can never be broken( pinky swear). Via smart contracts, you can simply convert the statements one says into code and deploy them on Blockchain. With this, the code is something that is incorruptible and once deployed on Blockchain, is public as well as decentralised.

Trading of goods, services, lotteries, basically any kind of transaction that includes the give and take of funds can be handled via Smart Contracts.

How do Smart Contracts come into the picture with Organizations?

Currently, we live in a centralised world where there is a hierarchy of power. There is a boss, then there are some managers and then there are employees at the end. This system is there throughout every organisation in the world, governments, companies etc.

Centralized Organization

Even though governments follow “democracy” and allow everyone to vote, there are a lot of flaws that hinder the growth of the organization.

  1. Its run by Humans, so corruption is always a certainty.
  2. Not everyone gets a say in big decisions.
  3. Transparency is rare.
  4. A huge amount of faith and trust is required in the system, which often leads to disappointment.

Smart contracts revolutionize this system. With Smart contracts, we can setup trustless third parties to handle the decisions. This way people can vote up for decisions and thanks to blockchain, everything gets logged on to the public ledger. Anyone with a curious mind can verify each and every decision and track if the funds are used in the correct place!!

The code of the Smart contract is visible to everyone and all the transactions done by it can be viewed publicly. This way the system has following new features:

  1. Incorruptibility ( as the decisions are executed by the code of the smart contract and not a person )
  2. Decentralized ( everyone gets to have a say in the decision)
  3. Transparency ( every transaction gets logged on the chain )
  4. Trustless System ( Who needs Humans when you have code ? 😎)

So how does a basic DAO function?

From a high-level overview: A smart contract takes care of the complete functioning of the organization. The members of the DAO can pitch their proposals, these proposals get stored in the contract.

Everyone votes on these proposals and then as per the results the required action is executed by the contract.

Decentralized Autonomous Organization

DAOs can be created for various purposes; they can be for funding educational institutes, running a company, pooling funds to buy NFTs, you name it. One of the various famous DAOs was the Constitution DAO which raised $ 47 Million to buy an original copy of the United States Constitution. Telling you these crypto people are crazy 😜.

Enough with the details of how DAOs work, tell me how to make one? Do I have to code one myself?

One doesn’t need to be a coder to make a DAO. Here is where Squads comes in. Squads allow you to create a fully functional DAO within a few minutes. It deploys the Smart Contract on Solana Blockchain. Solana is the fastest Layer 1 blockchain which allows fast and cheap transactions. Its high throughput capabilities make it one of the best blockchain ecosystems to build your DAO upon.

Functionalities Squads provides:

  1. Create your DAO in minutes.
  2. Easy interface for proposals and voting.

3. Built-in Defi Integration to manage the funds.

4. Multi-Signature Transactions- Management of team assets will be decentralized and multiple people need to agree and sign to use the funds.

5. Vaults and Treasury Diversifaction so that your DAOs can store all their crypto and Monkey JPEGs in one place.

6. Sub DAOs under a big DAO- Currently DAOs are getting adopted gradually but the vision of Squads is to be ready for mass adoption. Sub DAOs will make departments under the canopy of a big DAO; this way the particular proposals can be pitched to particular departments/sub daos. This is an essential feature if we want to run a big entity.

7. Mobile version coming soon. 😍

Squads went live on Solana Mainnet on 24th Feb, 2022 and already 1000+ DAOs have been formed on it since then. Whilst it went on mainnet it also raised a funding of $5 Million in a strategic round, here is an article on that.

Let’s create a DAO, shall we?

  1. Head on to https://app.squads.so/ .

2. Connect your wallet, it provides you multiple wallets to connect with, for this tutorial I will connect my Phantom wallet.

3. Create a Squad via this easy user interface.

4. Choose the type of Squad you want to create.

The types are explained in the picture above, I am choosing Multisig for now. In MultiSig, multiple signatures are required to manage the assets, this way the distribution of power makes the organization decentralized 😤.

5. Add in the necessary details, like the name and description of the Squads, and add the wallet addresses of other members on the next screen.

6. Decide on the number of signatures required to take each decision. Consider it this way, if you have five members on the DAO and if 3 people agree on a proposal it should get executed. Add the minimum number of signatures required to execute the proposal.

7. We are ready to deploy !!

You can see all the details on this screen, it currently shows one owner cause I require friends to make a DAO with 😔.

Once you hit deploy, a transaction should pop up in your wallet which will collect the fees for the creation of DAO. The fees are minimal as we chose Solana as the underlying blockchain to create our DAO on.

And just like that, we created a DAO within minutes.

What next?

Grow your DAO, get members, pitch in some funds and buy more virtual monkeys !!

Thank you for reading till the end. I am attaching more resources where you can learn more about DAO Governance and Squads.

References and resources for deep diving:

  1. What are Smart Contracts?
  2. What’s a DAO?
  3. Squads



Harsh Ghodkar

Coding Enthusiast | Machine Learning | Competitive Coder | Data Analyst | Full time Transponster