Are you looking to form a DAO?
A decentralized autonomous organization, or a “DAO,” is a Blockchain based “organization” encoded as a transparent computer program, controlled by the organization members rather than by any outside entity or authority.
Without incorporating a DAO looks like a Club or Partnership ie an unincorporated association wherein each of the members is jointly and severally liable in the event that the DAO is successfully sued pr incurs some other liability.
In order to ensure that the members can avoid personal liability – and so that the liability of the group collectively might be Limited – it is submitted that the preferred legal structure for most DAOs would be to incorporate as a Company.
As things presently stand the Wyoming DAO LLC would appear to be the most flexible vehicle for such purposes.
Creation of a DAO LLC
A DAO LLC is formed very similarly to a traditional LLC, with the primary difference being the two new steps of establishing the rules behind the DAO and funding the DAO prior to it becoming operational.
Establishing the rules involves deciding how the DAO will operate at the time of the formation and, although this can be changed later on, doing so often involves significant action from stakeholders.
Funding the DAO involves creating a token which represents and tracks the investments of stakeholders in the DAO, and is a way for stakeholders to participate in and influence the actions of the DAO.
DAO’s are not controlled by any single entity; although there must be an entity to create the DAO, this founder does not control the DAO after its creation. Although it is common for the founder of a DAO to participate in said DAO by contributing to the initial funding, this is not necessary. It is possible for a founder to create a DAO, but have no part in the management of said DAO following its creation.
Because DAO’s rely heavily on the initial ruleset implemented during formation, it is extremely important that the code behind this rule set is carefully written and that all potential bugs and security flaws are fixed before the system is deployed. Having a strong initial base for the DAO is essential to the success of the DAO moving forwards.
OCI Wyoming DAO LLC Formation Services
Decentralized autonomous organizations are completely legal, however as with all new technologies, DAO’s are subject to significant changes in regulation. Current Wyoming legislation under Bill-SF0038 (effective 07/01/2021) dictates that the management of a DAO LLC has many of the same requirements of traditional LLC’s, with some additional criteria for the more complex management structure and backend required for its operation.
A Wyoming DAO LLC can be formed quickly, correctly and inexpensively. We charge $US1,500 and it includes the following:
- Option To Select Member Managed or Algorithmically Managed Structure
- Inclusion of Publicly Available Identifier of Any Smart Contract Directly Used to Manage, Facilitate, or Operate the DAO in Articles of Organization As Required by Law
- Anonymous Filing of Articles of Organization Which Meet All Legal Requirements
- For Member Managed DAO, Operating Agreement Which Meets All Legal Requirements
- Resignation of Organizer Document
- 1st Year of Registered Agent Services As Required By Wyoming Law
- 5 Pieces of Mail Scanning
- Free Use of Our Address
NOTE: This option should ONLY be used by seasoned blockchain entrepreneurs with prior experience creating DAOs and Smart Contracts who are seeking to add the protections of Wyoming limited liability protections.
