The DAO LLC Act, in context.
Prior to 2021, decentralized autonomous organizations occupied an uncertain regulatory position globally — they were technically functional but legally unrecognized, exposing participants to a default partnership characterization and unlimited joint and several liability. Wyoming’s 2021 supplement to its LLC Act first opened the door, admitting DAOs as registered LLCs under a U.S. domestic statute. The Republic of the Marshall Islands followed with a dedicated DAO LLC Act in 2022, providing an offshore complement under the same charging-order tradition.
What it preserves.
The Marshall Islands LLC framework operates within the common-law charging-order tradition. A creditor of a DAO LLC member is, like a creditor of a conventional LLC member, limited to a charging order against the member's distributional interest — and may not interfere with the governance, management, or treasury of the entity itself. For clients whose digital-asset holdings have, until now, been held in unregistered DAOs or in personal wallets, the structural upgrade is meaningful.
Where it fits in the firm’s practice.
The Marshall Islands DAO LLC is treated, in our practice, as another statute we work within rather than a category of its own. The same considerations that govern the formation and administration of any LLC — purpose, governance, recordkeeping, jurisdictional alignment, downstream tax treatment — apply here. What differs is the substrate the governance runs on; the law accommodates the substrate without privileging it.
