The United Arab Emirates (UAE) is about to launch the legal framework for its Decentralized Autonomous Organization (DAO) in its free economic zone. It is understood that specific regulations will be proposed at a meeting on the 25th. Irina Heaver, a partner at law firm NeosLegal, said the framework is expected to regulate how DAOs can remain legally compliant, which she said will significantly impact decentralized governance in the UAE and the wider Web3 ecosystem.

Sweet Home Dubai for Exchanges, Friendly Regulation Attracts Web 3 Companies

Irina Heaver pointed out: “Under the new system, DAOs can be registered in the UAE, and they do not need to have entities in the UAE.” In other words, DAOs can be “remotely established” in the UAE, and these organizations will be able to open bank accounts. “This remote access makes it easier for global players to participate in the UAE’s booming digital asset industry,” said Irina Heaver.

We reported earlier that Bybit founder Ben Zhou revealed his true feelings, saying that Dubai regards blockchain as a development hope after oil, and the government welcomes exchanges with open hands, rather than treating blockchain as a crime. Lian News just recently went to Dubai to bring home the news that OKX has obtained the Dubai regulatory VARA license and the new headquarters has settled in Dubai. Binance Blockchain Week will also be held in Dubai at the end of the month. The joint choice of the three major exchanges also implies that Dubai will be the next development center of the blockchain (if the industry can survive for more than ten years).

(OKX establishes Dubai headquarters! It will deepen the development of Dubai encryption and support AED trading pairs and institutional derivatives markets)

Introducing DAO governance in the Web 3 free economic zone, and making DAO compliant

Ras Al Khaimah Digital Asset Oasis (RAK DAO) is a free economic zone in the UAE focused on digital assets that will be a demonstration zone for incorporating decentralized autonomous organizations (DAOs) into the legal framework. Irina Heaver said: “The introduction of a legal framework will enhance the UAE’s position as a global center for blockchain and digital asset innovation, attracting entrepreneurs and developers.”

It is understood that the new regulatory framework will address the legal and governance requirements of the DAO, including establishing a legal structure (although everything sounds quite decentralized). Specifically the legal structure will clearly regulate tax obligations and benefits. It will also define property ownership of on-chain and off-chain assets and provide legal protection from personal liability to DAO founders, members, and contributors. The framework will also enable DAOs to enter into legally binding contracts and establish guidelines for resolving internal and external disputes.

It’s not that registration in Switzerland is unaffordable, but it’s more cost-effective in the United Arab Emirates

But the UAE is not the only sovereign state trying to regulate the development of DAOs. DAOs can also be established in Switzerland. Although Switzerland does not have specific regulations for DAOs, it does allow the establishment of DAOs within its jurisdiction through a regulatory framework.

Nonetheless, Irina Heaver noted that registering a DAO in the UAE would be more cost-effective. Because in Switzerland, setting up a DAO can cost up to $46,000, while in the UAE, it starts at $3,000. “This affordability allows even the smallest DAOs to protect themselves and operate within the legal framework,” Irina Heaver added.

This article The UAE will launch a DAO regulatory framework at the end of the month, which will enable remote registration to enable DAO to implement legal entities. First appeared on Chain News ABMedia.