dao5 is an experimental cryptocurrency investment fund founded in 2022 by former Polychain Capital general partner Tekin Salimi. The firm operates with a long-term plan to transition into a decentralized autonomous organization (DAO), where governance and treasury management will be controlled by its community of tokenholders. ^{[1] [2]}

Overview

dao5 functions as a cryptocurrency asset manager with a unique two-phase structure. Initially, it operates as a traditional investment fund focused on making early-stage investments in cryptocurrency protocols and related companies.

The second phase involves a planned conversion into a DAO. This transition is designed to decentralize control and empower the founders of its portfolio companies. ^[2]

Upon conversion, the fund will mint and issue "DAO5" tokens to its core stakeholders, including the investment team, advisory board, and the founders of companies within its portfolio. A significant portion of the fund's general partner assets will be transferred to an on-chain treasury. This treasury will be owned and governed directly by the DAO5 tokenholders, who will collectively decide on its future use and management.

The stated primary objective of this model is to enable portfolio founders to co-manage a treasury of strategic assets, fostering a collaborative ecosystem. The organization anticipates that once it becomes a DAO, it will not have a fixed mandate, allowing it to evolve and adapt based on the decisions of its tokenholders and the needs of the decentralized economy. ^[2]

The firm's investment thesis is guided by a set of five core principles that emphasize collaboration, merit-based rewards, and privacy. This approach has informed its investments in projects such as Berachain, EigenLayer, and Story Protocol, as well as its strategic initiatives in the decentralized artificial intelligence sector. ^{[1] [3]}

History

dao5 was founded in 2022 by Tekin Salimi, who previously served as a general partner at Polychain Capital, a prominent cryptocurrency investment firm. Salimi's interest in the decentralized technology space predates the fund's establishment. For instance, he began following the Bittensor project in 2021, attracted by the quality of AI talent in its community and its vision for a decentralized AI network. This early interest led to the firm making over-the-counter (OTC) purchases of Bittensor's TAO tokens from miners active in the project's community channels. ^[1]

In December 2024, dao5 announced a major strategic expansion into the Bittensor ecosystem with the launch of 'tao5', an incubator program for projects building on the network.

This move was accompanied by the acquisition of the network validator previously operated by OWL Ventures, which at the time was the third-largest validator by stake on the Bittensor network. This acquisition positioned dao5 as a significant contributor to the protocol's security and governance. ^[1]

Funding

In May 2025, dao5 raised a $222 million fund. As reported by CoinDesk, the fund is designated for backing institutional blockchain adoption and will be used to support early-stage crypto protocols. ^[4]

Core Principles

dao5 operates based on five publicly stated core values that guide its investment decisions and organizational structure. ^[3]

• Incentive alignment: The fund's model is built on creating economic cross-pollination between its portfolio projects. Each founder of a company that dao5 invests in receives a grant of future DAO5 tokens. This is intended to foster a collaborative community where all members have a shared economic stake in the ecosystem's collective success.
• Meritocracy: The future DAO is designed to reward contributions based on merit. Any contributor who submits a successful investment proposal to the DAO will be compensated in a manner commensurate with the economic upside generated by that investment.
• Privacy: The organization champions individual and financial privacy as fundamental rights. It actively works with pseudonymous advisors and invests in projects led by pseudonymous founders. In line with this principle, dao5 has a policy of not investing in surveillance technologies.
• Dunbar’s number: Unlike DAOs that aim for mass participation, dao5 intends to keep its governance circle relatively small and tightly held. This principle is based on the concept of Dunbar's number, which posits a cognitive limit to the number of people with whom one can maintain stable social relationships. The vision is for governance to be managed by a "vanguard of aligned members" to avoid the potential pitfalls of large-scale, uncoordinated decision-making, often referred to as a tragedy of the commons.
• Occam’s Razor: This principle favors simplicity and decentralization. It is summarized by a quote from technologist George Hotz: “If there’s two evils in the world, it’s centralization and complexity.” This suggests a preference for straightforward, decentralized solutions over complex and centralized systems.

These principles are foundational to the firm's operational and investment strategies. ^[3]

Team

The founder and managing partner of dao5 is Tekin Salimi. Before establishing dao5 in 2022, Salimi was a general partner at Polychain Capital, one of the earliest and largest investment firms in the crypto industry.

His experience at Polychain provided him with deep insights into the crypto protocol landscape, which has informed the investment strategy and structure of dao5. Salimi also spearheads the firm's incubation pipeline, including the tao5 initiative focused on the Bittensor ecosystem. ^[1]

Key Initiatives

tao5 Incubator

In late 2024, dao5 launched 'tao5', an incubator program dedicated to supporting early-stage subnets on the Bittensor protocol, a decentralized network for AI.

The initiative aims to attract and support high-quality technical teams building on the platform. Tekin Salimi stated;

"Our goal is to help further enhance the caliber of technical teams building subnets on Bittensor. We believe that the fair and open ethos of TAO makes it the most promising ecosystem to attract best-in-class AI founders." ^[1]

As part of this initiative, dao5 acquired the third-largest network validator on Bittensor from OWL Ventures. By operating a major validator, tao5 aims to play a more active role in the protocol's security and governance while supporting the projects it incubates. The first incubation partnership announced was with Eternis, the technical team developing the 'Lean In' subnet.

This project is focused on creating an AI system capable of formally proving complex mathematical hypotheses. Srikar Varadaraj, founder of Eternis, commented on the collaboration, stating;

"Working with Bittensor and tao5 has marked the beginning of a strong partnership." ^[1]

Portfolio

dao5 focuses on early-stage investments in what it deems to be transformative crypto protocols and companies. In addition to its strategic focus on the Bittensor ecosystem, the firm's publicly disclosed portfolio includes several notable projects across different sectors of the crypto industry. ^[1]

Key investments include:

• Berachain: A modular blockchain platform focused on DeFi, built on the Cosmos SDK.
• EigenLayer: A restaking protocol built on Ethereum that allows users to reuse their staked ETH to secure other networks.
• Story Protocol: A decentralized protocol for intellectual property, enabling creators to manage and license their work on-chain.
• Movement Labs: A company building a network of modular blockchains based on the Move programming language.

This portfolio reflects a focus on foundational infrastructure, decentralized finance, and novel applications of blockchain technology. ^[1]