- The Samuels v. Lido DAO case accelerated the shift toward formal legal structures.
- Global competition continues as the United States and Switzerland shape their own frameworks.
- The Cayman Islands will implement the OECD Crypto-Asset Reporting Framework starting in 2026.
The Cayman Islands are seeing a sharp rise in foundation company registrations as Web3 projects reassess where to establish their legal entities.
Recent figures show a substantial year-over-year increase in these registrations, indicating the jurisdiction is becoming a preferred destination for decentralized projects seeking clearer legal certainty.
Growth began to accelerate toward the end of 2024 and has continued into 2025, as communities and project teams look for structures that can support the expansion of emerging ecosystems.
This trend reflects how recent legal developments, particularly in the United States, are pushing DAOs and other Web3 organizations to seek more predictable liability protections through formal legal wrappers.
DAO structural changes
Cayman Islands foundation companies are increasingly used as legal envelopes for DAOs and as custodial governance vehicles for major Web3 networks.
Registrations exceeded 1,300 entities by the end of 2024, with more than 400 new foundations formed in 2025 so far.
Cayman Finance reports that many leading Web3 projects have selected the jurisdiction, including at least 17 foundations that oversee treasuries above the hundred-million threshold.
These entities allow DAOs to sign contracts, manage intellectual property, hire contributors, and engage with regulators without exposing token holders to personal liability.
The shift picked up momentum after the 2024 Samuels v. Lido DAO decision, in which a U.S. federal court found that an unincorporated DAO could be treated as a general partnership under California law.
That ruling prompted many communities to reevaluate their legal structures.
The Cayman model offers distinct legal personality and property ownership capabilities that help close this liability gap.
Combined with tax neutrality and a regulatory framework familiar to institutional allocators, the jurisdiction becomes attractive to projects seeking both compliance readiness and operational flexibility.
Global Web3 competition
Jurisdictions worldwide are positioning themselves for the next wave of Web3 growth.
The United States has repeatedly signaled political intent to be a global crypto hub, including under the Trump administration, but only a handful of states explicitly recognize DAOs as legal persons.
This leaves many organizations navigating fragmented entity-level rules across U.S. states.
Switzerland remains a major onshore center for Web3 foundations: the Crypto Valley region now hosts over 1,700 active blockchain companies and has recorded growth of more than 130% since 2020.
Foundations and associations have become an increasingly significant part of that expansion, though projects continue to diversify jurisdictions in search of structures that align with their long-term plans.
Compliance shifts
The rise of Cayman-based Web3 foundations coincides with a major regulatory change.
The Cayman Islands have implemented the OECD’s Crypto-Asset Reporting Framework, with new Tax Information Authority regulations coming into effect on January 1, 2026.
The framework establishes due diligence and reporting obligations for “Crypto-Asset Reporting Service Providers,” covering entities that exchange crypto for fiat or other cryptocurrencies, operate trading platforms, or provide custody services.
These providers will be required to collect tax residence information from users, monitor specified transactions, and submit annual reports to the Tax Information Authority.
Legal professionals note that the rules apply specifically to service providers engaged in exchange or brokerage activities.
Entities that merely hold crypto-assets—such as protocol treasuries, investment funds, or passive foundations—may fall outside the scope of these obligations under current interpretation.
This suggests many DAO-linked foundations that act solely as ecosystem stewards or treasury vehicles can continue to benefit from the Cayman Islands’ legal certainty without taking on the full reporting burdens, provided they do not operate exchange, brokerage, or custody services.
As Web3 organizations mature and adapt to evolving compliance landscapes, the Cayman Islands appear poised to remain a central node in the global distribution of decentralized governance structures.