Setting Up a Legal Structure for RocketPool

Governance
1

Dear Rocket Pool community-

My name is Alex, I’m from DAObox team. We have been closely observing the developments within the Rocket Pool commuity and noticed that you seem to be approaching or may soon approach the phase of legal structuring and the establishment of legal wrappers.

In addition, we paid attention to the news about the statements of the core team to switch to fully decentralized governance.

DAObox is proud to offer an unparalleled service for DAO legal structuring. This service currently has no competitors in the market, and it comprehensively covers all three crucial stages of a structure’s lifecycle: design, formation, and operation, allowing you to get everything that’s needed for DAO structuring in one go.

Why DAObox?

Decentralized Design: Structures we design are ultimately controlled by the DAO through robust control mechanisms. A well-designed system of checks and balances provides full protection for DAO members and property.

Anonymity: DAObox acts as founder of the structure, undergoing all KYC checks and screenings ourselves. This shields the DAO contributors and members from exposure and risks, allowing them to remain anonymous.

In-Fact Management: After formation, we assume the roles of director and supervisor of the newly established wrapper. Our team de facto operates the structure and administers its day-to-day operations within the mandate and under the supervision of the DAO.

Efficiency: As we conduct in-fact administration of the wrapper, the DAO is relieved from needing to hire C-level managers, service providers, and other personnel typically required to manage and operate the structure. We have all these areas covered.

Protection: As the managers and only persons accountable for the operation of the legal wrapper, we absorb all risks associated with the operation of the legal wrapper.

Frameworks

DAObox is compatible with all legal frameworks currently available for DAO structuring. Our preferred structuring option is an ownerless foundation in the Cayman Islands, which is one of the most flexible and efficient structures that can be used for DAO wrapping.

In addition, we can establish the DAO wrapper as either a DAO LLC or foundation in other jurisdictions. We can guide the DAO on selecting the most fitting structure, as well as governance and control issues.

It’s imperative to underscore that any legal wrapper necessitates the assignment of management and staff to operate the structure. However, with DAObox, there’s no need for the DAO to allocate key contributors or risk exposure. Our service includes assignment of a dedicated team equipped to take on directorial and supervisory responsibilities, guaranteeing efficient management of the newly formed entity on a daily basis.

To get a better understanding, check out our Gearbox DAO case study and explainer video.

I will check back on this thread to answer any questions you may have and provide additional information on our potential engagement if necessary. Feel free to ping me if you have any questions.

Best regards,
Alex

1 Like
2

Why would Protocol DAO or Oracle DAO need a legal entity?

2 Likes
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Hi @peteris,

Eventually, almost every DAO needs a legal wrapper, mostly to ensure the DAO’s viability and protect the members, contributors, and DAO property. Beyond that, the wrapper is something the DAO can use to manage those activities that cannot be carried out off-chain.

The most common use cases for a DAO wrapper can include:

  • Engaging in real-world transactions, concluding contracts;
  • Holding, managing and protecting intellectual property, code, trademarks and domain names;
  • Owning, managing and protecting other property and assets;
  • Operating websites and user interfaces;
  • Having access to fiat payments;
  • Engaging and managing contributors and personnel;
  • Issuing grants and similar incentives;
  • Engaging auditors;
  • Managing third-party services, subscriptions, and tech infrastructure;
  • Improving overall reputation and appearance;
  • Other purposes.

I must note that our proposal is in line with the Rocket community’s development trajectories and project’s commitment to decentralisation and its enhancement, as mentioned here and here -
https://www.theblock.co/post/237808/rocket-pool-promises-to-fix- centralization-concerns-related-to-pdao. The proposed structure is designed to strengthen the decentralisation of the DAO and facilitate its structuring in the most efficient, effective and decentralised manner possible.

However, the move to decentralized management exposes the DAO to legal and financial risks. This could lead to joint liabilities for DAO members, the core team, and founders.

DAObox’s legal wrapper - is the solution designed to address these challenges. It assumes managerial roles, reduces joint liabilities, and ensures smoother decentralization while safeguarding stakeholders’ interests.

4

Can you summarize the article you linked to and explain how DAObox’s offering is related to what’s mentioned in the article?

2 Likes
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Certainly, please see below.

The article explores RocketPool’s journey toward complete decentralisation, with a special emphasis on enhancing governance, particularly within its Protocol DAO (pDAO) unit.

One key phase in the decentralisation process involves disentangling the DAO from major points of centralisation, such as entities controlled by the team and the original protocol founders. Within this framework, the DAO requires a legal structure to manage off-chain assets, acquire technology infrastructure, intellectual property, domains, and subscriptions, make fiat payments, and execute contracts.

Another critical consideration is the potential liability of DAO members. As recent court cases have demonstrated, unstructured DAOs can be legally classified as associations or partnerships. This classification implies that each member could be held personally liable for the DAO’s debts and obligations. To mitigate such risks, a legal wrapper offers a protective layer, shielding DAO members and contributors from personal legal and financial liabilities. It also serves as a framework for addressing tax considerations, adding another layer of security and peace of mind for all involved.

DAObox specializes in crafting top-tier legal structures for DAOs, ensuring that the DAO receives the ultimate control over the wrapper and has the final say on crucial matters. Furthermore, DAObox can assume management of this legal structure, ensuring that the Rocket DAO contributors remain anonymous and enabling the DAO to entrust us with legal complexities as they focus on their primary objectives. Compared to other market offerings, DAObox provides multiple unique advantages, which you can learn more about in our documentation at docs.daobox.io

Should you have any further questions, feel free to ask.