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A friend of mine told me that The DAO pays dividends in Ether. I can't find this anywhere, but assuming that it's true, how is this possible that it pays dividends if a person purchases The DAO through an exchange, but does not have an Ether address with that exchange?

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A friend of mine told me that The DAO pays dividends in Ether. I can't find this anywhere,

Ether is the default unit of exchange/value/etc in Ethereum.

but assuming that it's true, how is this possible that it pays dividends if a person purchases The DAO through an exchange, but does not have an Ether address with that exchange?

The DAO tokens are an ethereum asset that can only exist on an ether address. When you buy DAO tokens from an exchange the latter will create an ether address to store your DAO tokens (or put your tokens in one of their existing ether addresses and just have an internal ledger to know who has how much DAO tokens). Remember, what you see on an exchange is not necessarily what exists on the blockchain.

Also note that unless the exchange has some kind of mechanism to allow you to vote for DAO proposals you won't be able to... and they will control your voting power. I would recommend moving the tokens off the exchange to an ether address that you control if you intend to take part on the proposal/voting process.

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  • Do any exchanges allow voting that you know of, or will it be private only? – user541852587 Jun 14 '16 at 22:13
  • Not that I know of. If you want an easy way to vote you could use myetherwallet but that also assumes you trust them (they do ask for your private key). – karask Jun 15 '16 at 8:05

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