What is BitDAO and why has it rallied 30% in the last 7 days?

There are no two ways about it, 2022 was a terrible year for the digital asset industry. However, the New Year has gotten off to a good start. In fact, most coins in the top 100 list in terms of market capitalisation have posted gains since the start of 2023. One token that’s pulling ahead of the rest of the pack is BitDAO (BIT). It is up more than 10 percent YTD, leagues ahead of Bitcoin and Ethereum, which are up 0.71 and 1.47 percent, respectively, since the start of the year.

But what is BitDAO, how does it work and why is it rallying in 2023? Tag along to find out.

BitDAO (Decentralised Autonomous Organization) is a decentralised platform built on the Ethereum blockchain that allows users to collectively manage and invest in cryptocurrency assets. It is designed to be a transparent and democratic platform for making investment decisions, with users able to vote on proposals and receive a share of the profits generated by the DAO's investments.

The BitDAO platform is powered by smart contracts written in the Solidity programming language. These smart contracts handle various functions of the DAO, including voting, asset management, and distribution of profits. Users can participate in BitDAO by purchasing BIT, a governance token of the BitDAO ecosystem, that represents a stake in the DAO. BIT holders are entitled to vote on proposals and receive a share of the profits generated by the DAO's investments.

One of the key features of BitDAO is its decentralised governance structure. This means that decisions about how the fund is managed and invested are made by a group of users who are elected to serve as "governors." These governors are chosen by the community of BitDAO users through a voting process. This decentralised governance structure allows for more transparency and accountability and the potential for more informed and successful investment strategies. It also ensures that the interests of the DAO's users are represented in decision-making, rather than being dictated by a centralized authority.

There are several benefits to using BitDAO as a platform for managing and investing in digital assets:

Collective decision-making: By pooling resources and making investment decisions as a group, users may be able to achieve better results than if they were investing individually. The decentralised governance structure of BitDAO allows for a diverse range of perspectives to be considered when making investment decisions, potentially leading to more informed and successful strategies.

Transparency and accountability: The decentralised governance structure of BitDAO ensures that decision-making is open and transparent, with all users able to participate in the voting process. This helps ensure that the DAO's users' interests are represented and that the fund is managed responsibly and accountably.

Potential for higher returns: By carefully selecting and managing a diverse portfolio of cryptocurrency assets, the DAO may be able to generate higher returns for its users. The collective decision-making process and decentralised governance structure of BitDAO can help to ensure that the fund is managed in a way that maximizes profits for its users.

Diversification of investments: By allowing users to pool their resources and invest in a diverse range of cryptocurrency assets, BitDAO can help to reduce the risks associated with investing in a single asset. This can potentially lead to more stable and consistent returns for the DAO's users.

BIT has started 2023 on a tremendously positive note. The token has gained more than 10 percent since the beginning of the year and more than 30 percent over the last 7 days.

But what is the reason for the sudden rally? Well, just a few days back, the team behind the project announced a governance proposal that will initiate a $100 million buyback of its tokens. The entire process commenced on day 1 of 2023 and will see $2 million worth of BIT purchases every day for the next 50 days. The proposal was accepted with open arms by its investors who see it as a promising venture leading to a better future for the project. BitDAO prices jumped almost 21 percent after it closed a Doji candle on December 28, 2022.

At the time of writing, BIT was trading at $0.36 after gaining a further 6.45 percent over the previous day. Experts are eying more gains in the near future.

BitDAO is an interesting project, and it is clear that investors have shown good faith in it by helping it sail through the turbulent market conditions of the previous year.

With a focus on combining on-chain and off-chain products, the project has attracted quite a lot of attention, and with its buyback plans, BitDAO might be looking at higher gains in the coming weeks. It will be interesting to see how its plans unfold over the new year.