The Republic of the Marshall Islands has solidified its position as a global hub for decentralized autonomous organizations (DAOs). The island nation made itself a beacon for the rest of the world after enhancing its legal framework for DAOs.
Marshall Islands is a standout destination for crypto and blockchain innovation. It has considerable autonomy from U.S. federal laws. The nation still has access to essential U.S. services like the Postal Services, Federal Aviation Administration (FAA), and the U.S. Military.
How is Marshall Islands shaping itself as a DAO hub
An amended version if the “The Decentralized Autonomous Organization Act” was passed in the parliament last week. The bill’s foundations were laid in 2022.
Member of Parliament David Paul and Adam Miller, the CEO & Co-Founder of MIDAO (a public-private partnership with the Marshall Islands) authored the bill. They said that this new legislation marks an important moment for DAOs globally.
Marshall Islands recognizes DAOs as legal entities since February 2022. Unlike many other jurisdictions they facilitate incorporation of nearly 100 DAOs.
Initially, the law granted DAOs remarkable autonomy. It allowed almost every member to remain anonymous and eliminated the need for a board of directors. Now, even more benefits are brought to the table by the latest amendments.
What are the new amendments?
One of the most notable improvements is the reduced time of registration process to a maximum of 30 days. Previously registration could take upto 30-60 days.
The amended law will also shield DAOs from unwarranted responsibility for open-source software usage. Further, it explicitly defines most governance tokens as non-securities if they don’t confer economic rights.
In order to establish a DAO in the Marshall Islands, potential stakeholders should visit MIDAO.org and enlist MIDAO as their registered agent. This will eliminate the need for a local office or a local law firm. It will make it accessible to a broader audience of DAO creators.
This legislation also recognizes Series DAO LLCs, which allow for DAOs within a DAO. Each DAO has its own set of assets and liabilities. A new layer of versatility to DAO structure is added with this innovative approach.
Marshall Islands is rapidly becoming a pioneer in blockchain governance and DAO regulation, providing a blueprint for the world while embracing innovation and digital transformation.