The Republic of the Marshall Islands has now formally recognized DAOs, decentralized autonomous organizations, as legal entities. The measure gives blockchain decentralized management projects the recognition and legal certainty necessary for them to develop.
These blockchain-based entities governed by self-organizing communities gained legal recognition in the Marshall Islands after the country passed the Non-Profit Entities Act of 2021.
As it currently stands, the new legislation allows any DAO to register and establish operations in the Marshall Islands.
The former Chief Secretary of the Republic of the Marshall Islands stated that his country recognizes that now is a “unique time to lead” the “blockchain revolution”. According to him, DAOs will play an important role in creating “more efficient and less hierarchical” organizations.
The Marshall Islands is an independent state located in the Pacific Ocean near the Equator, with a population of around 59,000. The small state has been actively exploring use cases for digital assets since 2018.