The world finally has its first legal DAO, thanks to developments in the state of Wyoming.
The American CryptoFED DAO, an organization dedicated to creating a monetary system resilient to fluctuations in value, received notice from the Wyoming Secretary of State’s office that its project had been officially recognized as a DAO in the United States.
This is a major step for the project and decentralized governance initiatives. It shows that the U.S. is open to recognizing organizations with innovative structures, even if they lack a centralized hierarchy.
Wyoming Becomes The First DAO-Friendly State in the US
DAO is the acronym for decentralized autonomous organization. It is a way of organizing a community through the use of blockchain technology to make consensual decisions without a central body that regulates voting or is in charge of implementing projects. In a DAO, the community participates in decision making through various voting mechanisms previously encoded inside a smart contract, and the decisions that have the support of the majority of votes are executed.
Generally, one person can cast several votes, so power tends to reside among those who concentrate the most wealth.
Wyoming’s Secretary of State Edward Buchanan shared his congratulations to the DAO team and assured that Wyoming will always continue to encourage the development of new forms of business:
Wyoming has a reputation for being on the leading edge of business technology, beginning in 1977 with the recognition of LLCs. We are proud to continue this innovation by offering legal protections to Decentralized Autonomous Organizations.
I congratulate American CryptoFed DAO, LLC, the first legally recognized DAO filed in Wyoming with the Secretary of State’s Office.
Senator Cynthia Lumis, a recognized bitcoiner and strong cryptocurrency advocate also represents the state of Wyoming.
Marian Smith Orr, one of the project’s leaders, shared her excitement and thanked all those who helped accomplish such a major milestone_
Excited to be making history this July 1st! We just completed the formation of what we believe to be the first official Wyoming DAO LLC in the world! Thank you for making it possible @MDKaufman307 @Tyler_Lindholm @rothfuss @TaraNethercott @GovernorGordon and so many others! pic.twitter.com/ivR0KwWHhI
— Marian Smith Orr (@gofishwyo) July 1, 2021
How Does It Works?
The American CryptoFed DAO works with two tokens.
The Ducat is a coin designed for daily transactions and a store of value by protecting its price from fluctuations against the dollar.
Although it could be thought of as some kind of stablecoin, in reality that is not necessarily accurate. The Ducat has no collateral backup, nor is its supply predefined. “Market price is managed to be close to the target via Machine Learning and Linear Control Theory applied to on-chain data,” they explain on their website.
The Locke is a governance token designed to be used by those participating in the DAO and ensure the stability of the Ducat.
The American CryptoFED DAO expects its tokens to be used primarily among merchants and individuals seeking to conduct P2P business. The idea is to protect the purchasing power of participants as the value of the U.S. dollar depreciates.