- The recommendation was put forth in October 2021.
- The Corporations Act, which establishes criteria for company governance and personality, should be applied to decentralized autonomous groups.
With a lot of countries feeling threatened by the growing hype and utility of cryptocurrencies, lawmakers are getting anxious as they would lose the power to manipulate the flow of currency in their respective countries. Next in line to follow this trajectory is Australia as Senator Andrew Bragg announced the country’s intentions to regulate DAOs.
A DAO (pronounced dow) is a special type of blockchain-based management structure that is sometimes referred to as a crypto co-op. DAOs, in their most basic form, are groups of people that get together for a shared goal, such as investing in start-ups, administering a stablecoin, or purchasing a large number of NFTs. DAOs are “governing bodies that manage the distribution of resources connected to the projects they are associated with and are also entrusted with guaranteeing the long-term viability of the initiative they support,” according to ConsenSys, a blockchain firm.
The recommendation was put forth in October 2021. The Corporations Act, which establishes criteria for company governance and personality, should be applied to decentralized autonomous groups.
He said, “Decentralized Autonomous Organisations can replace Companies. It might be the most significant development since the first joint-stock companies floated on the Amsterdam Stock Exchange in 1602. If that doesn’t make policymakers listen, perhaps this will. Given that DAOs are recognized as partnerships, not companies, they are not liable to pay company tax. Company tax accounted for 17.1% of total Commonwealth government revenue. Our reliance on company income tax is unsustainable. DAOs are an existential threat to the tax base and they must be recognized and regulated as a matter of urgency.”