Inside the guide
A chapter-by-chapter look at what's covered.
1. Why Incorporate Your Web3 Project
The general partnership problem is no longer theoretical. Ooki DAO (CFTC, 2022) and Samuels v. Lido DAO (California federal court, November 2024) both ruled that governance participants face joint-and-several personal liability without a legal wrapper. Plus the practical reality: corporate personhood is the price of admission for banking, exchange listings, contracts, IP ownership, and credibility with institutional partners.
2. What You're Actually Buying: A Digital LLC
The legal entity is the RMI DAO LLC. The more honest description for most clients is Digital LLC: a limited liability company that exists natively in digital form, governed by digital documents, capable of recognizing on-chain records as official records. The Digital LLC concept comes from Harvard Law School's Berkman Center (2010), building on Vermont's 2008 virtual LLC legislation. Wyoming made the first sovereign attempt in 2021. The Marshall Islands made it work at production scale.
3. US vs. Offshore: Making the Decision
Honest framework, not a sales pitch. US makes sense if your team is entirely US-based, banking is domestic, and primary investors are US institutions. Offshore makes sense for international teams, projects targeting global token holders, or projects that want to minimize US regulatory nexus without abandoning compliance. Plus the hybrid approach: offshore Digital LLC for governance, Delaware C-Corp for the venture-funded operating company.
4. Jurisdiction Comparison
Honest comparison of the RMI Digital LLC against Wyoming DAO LLC, Wyoming DUNA, the Cayman Foundation, the Swiss Foundation, the UAE ADGM DLT Foundation, RAK DAO, Singapore foundations, and BVI structures. Cost ranges, governance flexibility, tax treatment, banking access, and track record for each. We believe the RMI is the right answer for most Web3 projects. We also explain when it is not.
5. Entity Types Explained
LLCs, C-Corps, foundations. For-profit vs. non-profit. Why most Web3 projects end up at a non-profit Digital LLC for governance even when they raise venture capital (the C-Corp does the raising; the Digital LLC handles the protocol). Why foundations require directors with fiduciary duties that can override community decisions, which most Web3 projects do not actually want.
6. Use Cases: What Type of Project Are You?
Segment by segment. DeFi protocols (governance + treasury). NFT projects (IP ownership + token issuance). Meme coins and token launches (clear issuer of record, treasury management, securities positioning). Investment DAOs (Series structures for compartmentalized portfolios). DePIN (entity for hardware contracts and physical assets while keeping governance decentralized). AI agents (algorithmic management as a wrapper for autonomous agents, a separate dedicated guide for that audience).
7. Securities Law and Token Considerations
Token classification under the Howey test. The 2023 RMI DAO Act Amendment carve-out for non-profit governance tokens with no economic rights, written into statute, not interpreted from a lawyer's opinion. Why VASP licensing requirements do NOT apply to RMI Digital LLCs that issue governance tokens. What still applies: US securities law for US-facing token sales regardless of where your entity sits, EU regulation for EU buyers, and so on. Offshore reduces nexus; it does not eliminate obligations.
8. How to Get Started
What to prepare, what to expect. Registration starts at $9,500 and completes in under 30 days under the 2024 Regulations. Annual maintenance is light by design. Crypto payment supported. What MIDAO provides: refined operating-agreement templates, registered-agent services, government relationship, ongoing compliance support across hundreds of incorporations.
Who this is for
DAO LLC is a legal designation, not an identity requirement. This is the most important sentence on this page. Most projects that need a legal home for their tokens are not DAOs in the traditional sense. They self-filter when content presumes they are.
If your project has any of the following, the Digital LLC framework is built for you:
- A token (live or planned) that needs a clear issuer of record
- A treasury that needs to live in an entity, not in a personal wallet
- Intellectual property worth protecting (brand, code, contracts)
- Counterparties (banks, exchanges, sponsors, auditors) that need to transact with a legal person
- Members or contributors whose personal assets shouldn't be exposed to project liability
That covers most Web3 projects. Specifically:
- Protocol teams building DeFi, infrastructure, oracles, or middleware that will eventually transition to community governance.
- NFT project teams that need a home for IP (the art, the brand, the licensing rights) and a clean structure for treasury and royalty management.
- DePIN operators signing hardware vendor agreements, negotiating with telcos or utilities, and managing physical asset ownership while keeping network governance decentralized.
- Meme coin teams that need a clear issuer of record, exchange-listing readiness, and securities positioning even if the project started informally.
- Token launches building the legal structure before the launch, not after the lawsuit.
- Investment vehicles and tokenized funds running compartmentalized portfolios where Series Digital LLCs let each portfolio carry its own assets and liabilities.
- Teams that aren't DAOs yet. Small teams building a protocol, planning to decentralize governance once they launch, but not there yet. The Digital LLC starts manager-managed and transitions to algorithmic governance when the protocol is ready, all in the same entity. About half of MIDAO's entities have no on-chain activity when they register.
If you are building any of those things, this guide will get you oriented. By the time you finish reading, you will know whether the RMI Digital LLC is the right structure, what the trade-offs are versus the major alternatives, and what the registration process actually looks like.
Trusted by hundreds of Web3 projects
The RMI Digital LLC framework is in production with the most active Web3 projects in the space. Pyth Network uses it for the entity behind Solana's largest oracle. GMX built one of the largest decentralized perpetuals exchanges around it. MetaDAO built futarchy-governed protocol governance on top of it. MoonDAO raised $8.3M and sent an astronaut to space. ApeCoin Governance, Gnosis Guild, Elastos, Dope Wars DAO, Clipper/Admiralty (the first-ever RMI DAO LLC), and a growing list of investment vehicles including Ranch DAO, Layer 2 DAO, and Based VC DAO all chose the structure. 250+ tokenized organizations have registered with MIDAO since 2022.
Send me the Web3 Legal Entity Guide.
The complete guide. Free PDF.
Frequently asked questions
Do I have to be a DAO to use this structure?
Almost always no. The name is historical: the RMI law was originally written for traditional DAOs, but the structure works for a much broader set of Web3 projects. Our clients include DeFi protocols, NFT projects, meme coins, token launches, investment DAOs, DePIN networks, and AI agent operators. Many do not call themselves DAOs and never intended to. If your project has a token, a treasury, IP worth protecting, or counterparties that need a legal entity to transact with, the Digital LLC framework probably fits.
What is the difference between a DAO LLC and a Digital LLC?
They are the same legal entity. The Marshall Islands statute creates the DAO LLC entity type, and that name appears on every legal document we file. Digital LLC is the more accurate marketing description for most clients: a limited liability company that exists natively in digital form, with statutory recognition of on-chain governance and digital records. We use both names because they describe the same thing. Which one matters depends on which audience is asking.
Can a Marshall Islands DAO LLC open a bank account?
Banking is the most common practical concern. The Marshall Islands itself has a limited banking system, but our clients have successfully opened accounts at US banks (Western Alliance, historically Signature before it closed), European banks, Middle Eastern banks, and increasingly with neo-banks and fintech platforms. Neo-banks (modern financial companies that use traditional banks on the back end) are often the most practical option for crypto-native projects. The main constraint is the same as for any crypto-adjacent entity: each bank evaluates the relationship individually.
Does MIDAO handle token issuance or smart contract development?
No. MIDAO provides the legal entity structure. We do not issue tokens, deploy smart contracts, or build dApps. The Digital LLC we provide can accommodate token-based membership, on-chain governance, and treasury management, but the technical implementation is yours (or your developers'). When clients ask, we can introduce them to law firms, technical teams, and other service providers who handle the parts we do not.
My project does not have on-chain governance yet. Can I still incorporate?
Yes, and many of our clients do exactly this. The Digital LLC can start manager-managed, with the founders serving as managers while the protocol is being built. When the project is ready to launch governance tokens and transition to community decision-making, the operating agreement can be updated to reference the on-chain governance contracts. The same entity that started manager-managed becomes algorithmically governed as the project matures. This is a clean approach to progressive decentralization: legal benefits from day one, no need to figure out final governance before you are ready.
How does the RMI structure handle securities concerns for governance tokens?
Non-profit governance tokens issued by an RMI Digital LLC, where those tokens carry no economic rights (no right to distributions, no claim on assets), are explicitly not treated as securities under RMI law. That carve-out is in the 2023 DAO Act Amendment. It is statutory, not an opinion. This protects you under RMI law. It does not override US securities law for US-facing token sales, EU regulation for EU buyers, or any other jurisdiction's rules. The offshore structure reduces your US nexus; it is one part of a complete securities posture, not the whole thing.
Other guides
DAO LLC Guide
For traditional DAOs, governance protocols, and on-chain communities where the token is the membership. Operating agreement templates, on-chain governance recognition, securities carve-outs, and the registration path.
Get the guide
AI Agent Legal Entity Guide
For autonomous AI agents and agentic infrastructure. The Digital LLC framework for systems that need legal personhood, no required directors, and on-chain governance.
Get the guide