The price of Ether, a bitcoin rival, is soaring because of a radical, $150 million experiment

Thousands of people have pumped $150 million into what might be the biggest crowdfunded project in history, something called the Decentralized Autonomous Organization (DAO). Compare this to the $20 million raised by the project with the most funds on Kickstarter, the Pebble Time smartwatch. The strange thing about this crowdfunding is that the DAO doesn’t produce any concrete products or services–not yet, anyway.

The DAO’s big promise is that it’s an entirely new way to manage and allocate capital. More specifically, it’s capital allocation without a fund manager. Think of it as venture-capital firm Andreessen Horowitz, but with Marc Andreessen and Ben Horowitz replaced by the wisdom of the crowd.

That crowd consists of about 11,000 anonymous stakeholders who can vote directly on any major decision to spend the organization’s funds. Companies or individuals who want to tap the funds must submit a proposal. These proposals are published online, and stakeholders ultimately vote on whether to adopt them, allocating a slice of the $150 million, or not. Stakeholders then stand to gain from the profits generated by these proposals, whether in the form of dividends or an increase in value of their tokens.

“This is an incredible evolution over the Kickstarter model,”

Read more ... source: TheBitcoinNews