By Michael Scott
The Decentralized Autonomous Organization Act of 2022 was passed into law by the Republic of the Marshall Islands (RMI). The legalization of DAO in the Pacific Island nation comes when the governments are witnessing increased pressure to enact crypto-friendly regulations that facilitate the expansion of decentralized firms and blockchain adoption.
DAO Key to DAO Increased Uptake in Blockchain and Economic Growth
The announcement dated 22 December confirms that the Marshall law recognizes DAO, and registered legal firms are encouraged to embrace DAO-defined structure and governance tools. The government is optimistic that adopting DAO positions decentralized firms at a pivotal point to flourishing.
The President and Co-Founder of MIDAO-Bobby Muller admitted that the revolution of blockchain technology influences Gen Alpha to explore practical ways to reach sound decisions.
He argued that DAO allows people to make decisions more efficiently. Bobby’s opinion gained support from the country’s Finance Minister -Bransen Wase, who argued that adopting DAO will increase blockchain space and foster RMI economic growth.
Marshall Island Gambles for a Decentralized Future
The text of the Decentralized Autonomous Organization Act of 2022 indicates that DAO will be legally permitted to incorporate as limited liability companies (LLCs). The Act stipulates DAO formation and agreement terms and guides on using smart contracts.
Undeniably, the DAO Act of 2022 accepts both profit and non-profit entities to register, aiming at attracting DAO developers and Web3 inventors. This distinctive Act recognizes DAO governance and voting structure enabling the creation of an investment fund for the RMI government to facilitate the ongoing DAO education and training.
Nonetheless, the adoption of DAO in RMI tasks MIDAO Directory Services Inc., a local organization, to facilitate the DAO registry process. Beyond the registration, MIDAO is mandated to educate the public on the benefit of DAO structure on RMI courts and provide expert services to attract investors.
Correspondingly, Adam Miller, CEO of MIDAO, acknowledged that integrating DAO into the legal system would increase decentralization and enable legal firms to cope with technological changes.
The enactment of the Decentralized Autonomous Organization Act portrays progress realized by the Marshall Island to actively explore mass utilization of digital assets. Recently, the government announced the establishment of a framework that will support the creation of block-chain crypto considered as Sovereign (SOV).