Exploring DAO Members' Individual Liability
21 Pages Posted: 4 Mar 2022
Date Written: February 28, 2022
Abstract
The rise of cryptocurrency and blockchain technologies has revived the attention to decentralized autonomous organizations (DAOs) for social cooperation enabled by algorithms and the internet. They can substitute or complement conventional organizations. From a legal and governance perspective, to what extent should members and other participants be held accountable, responsible, and liable for DAOs? While some argue that DAOs should benefit from limited liability and legal immunity for the members, others favor individual liability. This paper argues for the latter approach to promote public policies and responsible innovation and explores principles and mechanisms available for holding members individually liable.
Keywords: Blockchain, DAO, DeFi, Cryptocurrencies, Liability, Risk, Web3
JEL Classification: G38, K24, K42, L53
Suggested Citation: Suggested Citation