Help The UK Govt Understand Decentralised Autonomous Organisations (DAOs)

Source: Yield App

The Law Commission is calling for evidence to help shape its current understanding of the issues raised by Decentralised Autonomous Organisations ("DAOs").  The UK government has asked the Commission to accurately capture the composition of DAOs, their role in the cryptoasset ecosystem, participants and relationships. The Commission will identify options for law reform that might be required to make DAOs viable, possibly including “classes” of DAOs, but not to make recommendations yet. Responses may be submitted online between 16 November 2022 and 25 January 2023. It's worth contributing to help ensure all the challenges are identified and one day addressed. I have previously been asked to look into various aspects of DAOs. If you would like help in making any submission (including on your behalf), please let me know.

Broadly, a DAO is an organisation that relies on distributed ledger or blockchain technology, as well as smart contracts or other software/systems. It basically operates in a similar fashion to a partnership, club, co-operative or unincorporated association but online, so members could be anywhere. This can be helpful where the local community is too sparse or lacks resources to achieve a certain goal, but unincorporated associations and partnerships don't have independent legal status and carry unlimited liability for their members. Some DAOs include a recognised legal entity to interact with the 'real world' but others may operate solely via 'code' and/or smart contracts to automate some or all of their activity. This has created problems where the code did not operate the way users understood.

The Commission is looking for information from those with general knowledge of DAOs, as well as first-hand experience of specific DAOs, and to understand where opinions vary on any aspect or issue (with "sanitised or anonymised submissions where it is inappropriate to provide details about a particular DAO").

Personally, I've been approached several times to advise on certain challenges associated with DAOs, particularly governance, appropriate jurisdictions, potential authorisation and means of enforcement.

It's worth contributing to help ensure all the challenges are identified and one day addressed - at least in the law of England & Wales, but other common law jurisdictions may also benefit from the Commission's work.

If you would like help in making any submission (including on your behalf), please let me know.