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The legal structure of decentralised autonomous organisations (DAOs)

This paper critically evaluates the legal structuring of DAOs, focusing on the jurisdictional challenges and the efficacy of wrapper entities like the Wyoming D

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Abstract

This paper critically evaluates the legal structuring of DAOs, focusing on the jurisdictional challenges and the efficacy of wrapper entities like the Wyoming DAO LLC or the Marshall Islands DAO registration. The author analyzes the ‘code versus law’ debate, arguing that while DAOs operate autonomously, their real-world impact necessitates integration with legal jurisdictions to provide stability and protection. The study assesses the pros and cons of decentralized incorporation, examining how these legal wrappers influence governance, tax liability, and dispute resolution. By providing a comparative analysis of different legal jurisdictions, the paper offers a practical roadmap for developers and organizers seeking to formalize their decentralized organizations. The work is a critical contribution to the discourse on how blockchain projects can survive within the global regulatory environment. Authors: A. G. Cardoso Publication: Academic Paper Publication date: 2025-01-01

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Key findings

  • ‘Wrapper’ entities offer necessary legal protections but may compromise the purist decentralization of a DAO.
  • The choice of jurisdiction significantly impacts the governance rights and tax obligations of participants.
  • Legal integration is increasingly viewed as a prerequisite for institutional participation in DAOs.
  • There is no single ‘best’ legal structure, as the ideal choice depends heavily on the DAO’s specific operational goals.

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Citation

A. G. Cardoso (2025). The legal structure of decentralised autonomous organisations (DAOs). Academic Paper. https://www.tandfonline.com/doi/abs/10.1080/13600834.2025.2461949
Canonical knowledge ID: research:the-legal-structure-of-decentralised-autonomous-organisations-daos