In the spirit of web3 support and adoption, I’m launching BADASL Monthly Mints! Yes… I’m following (proudly) in the footsteps of Bankless’ Monday Mints.
This is an experiment about how a centralised company like BADASL can begin taking steps to grow its place in the web3 ecosystem, and eventually transition or restructure to a DAO (if that is ever going to be a tax effective / tax neutral exercise)! Your NFT does not grant any rights at this stage and is a mere expression of support. The mint price is treated as GST inclusive if you are an Australian resident, and GST free if you are not an Australian resident. Send an email to firstname.lastname@example.org if you would like a tax invoice.
Please subscribe and collect each edition to support more of the good work happening at BADASL.
So what happened in January 2023?
Breaking new ground:
Started working with DAO* as captain of their Regulatory Interoperability working group. DAO* is an alliance of DAO builders in a race to build standards that will realise the promise of this technology. First key focus for me and my working group is building a data standard that leverages EIP-4824 as well as a Proof-of-Concept DAO* Registry Interface. We have a unique opportunity now to build our own, privacy-preserving DAO infrastructure that helps make DAOs more understandable to the everyday person, including policy makers and regulators.
Started working with COALA (coalition of automated legal applications) Foundation to assist with:
Utah’s adoption of a DAO bill based on the COALA DAO Model Law - note also New Hampshire of a DAO bill on similar basis
Response to UK Law Commission Call for Evidence on DAOs
The DAO Model Law review and update process – it was only launched in 2021 but web3 moves quickly and there’s been a lot of feedback
Responding to requests for tender applications to develop DAO policy frameworks and legislation
Launched BADASL Legal CPD sessions (below) with more to come - bookings and recordings via the BADASL website:
2023 Policy & case law update – DAOs and token activities
1. Australian Treasury consultation paper: token mapping
2. Australian Board of Taxation review into tax treatment of digital assets
3. Treasury Laws Amendment (2022 Measures No. 4) Bill 2022 (to exclude BTC from being treated as a foreign currency)
4. Industry standards and proposed regulations for: token custody; token exchange services; stablecoins; DAOs
5. Recent case law in Australia and overseas
2023 DAO tax masterclass
1. Tax entity classification and pitfalls of common 'legal wrapper' structures
2. Taxable permanent establishments and transfer pricing consideration
3. Anti-avoidance and integrity provisions
4. Tax risk management approaches
BADASL DAO Health Checks and Legals
Supporting DAOs with a fixed cost high level legal or strategic review of their governance and operations, workshop discussion and health check note with key action items.
Template for high level transfer pricing analysis and risk assessment of a DAO.
Template for assessing central management and control of a DAO for Australian tax purposes.
DAO service entity agreements and deeds of delegation (where DAO does not have legal capacity to enter contracts or hold property).
Disclaimers and terms for participation incentive schemes involving staking - a key focus is social cohesion of the DAO to eliminate or address quickly any harmful practices. See here for Bankless’ take on social cohesion.
Litigation work increasing across tax, regulatory and consumer areas of law.
Talks and roundtables
19 Jan 2023: Amsterdam Centre for Tax Law-CPT Talks: In discussion with Joni Pirovich about taxation of DAOs, available here.
AASB roundtable on digital asset accounting as part of joint research by AASB, CPA Australia and UNSW.
Policy and publications
World Economic Forum DAO Policy Toolkit launched, which I contributed to throughout 2022.
Submission to Australian Senate Economics Legislation Committee regarding the Bill introduced in late 2022 to clarify retrospectively that BTC cannot be treated as a foreign currency for income tax purposes, available here.
COALA submission to UK Law Commission Call for Evidence on DAOs, which should be available on the COALA website shortly.
Discussions with the Australian Law Reform Commission about DAO policy.
What’s on in February?
LawFi DAO Digital Organisation Design workshop series, facilitated by the team at Multilateral Group (Australia) Pty Ltd. You can watch the recordings here and sign up for them via the event buttons on the LawFi DAO LinkedIn page.
Continue work with DAO*, COALA and BADASL legal work.
Submission to Australian Treasury’s token mapping consultation paper, available here.
Submission to the Australian Law Reform Commission’s Background Paper on New Business Models, Technologies and Practices, available here.
Talk on Crypto Assets and DAOs with the Corporate Law and Financial Regulation Research Program, in association with the ALRC at 5.00 pm AEDT on 15 February. You can register here.
UK Law Commission DAO Advisory Panel session.
Author: Joni Pirovich, Principal, Blockchain & Digital Assets Pty Ltd.
Acknowledgement: We acknowledge the Traditional Custodians of the lands we live and work on. We pay our respects to Elders past, present and emerging, of all First Nations peoples.
Content License: All rights are reserved in respect of this work. Blockchain & Digital Assets Pty Ltd grants a non-exclusive, royalty free license to use this work for the following purposes:
a) to read and discuss for educational purposes;
b) to copy and redistribute the work for educational purposes as long as appropriate attribution is made to the author and Blockchain & Digital Assets Pty Ltd; and
c) to sell a BADASL Monthly Mint NFT if the holder no longer wishes to hold it as a collectible.
Other persons and DAOs (to the extent DAOs are not recognised as persons) are granted a non-exclusive, royalty free license to use this work for the same purposes as stated above.
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Collecting: By collecting a BADASL Monthly Mint NFT you will be promoted to pay the collection fee which is inclusive of Australian Goods and Services Tax (GST) if you are an Australian resident or GST-free if you are a non-Australian resident. A tax invoice and receipt can be provided to you upon request to email@example.com. Each BADASL Monthly Mint NFT is deployed on Optimism, an Ethereum Layer 2 network. No royalty has been set for secondary sales of NFTs so secondary sales are treated as a commercial exchange between the NFT holder and purchaser where the NFT holder is responsible for the legal and tax implications of resale while respecting the license rights. Blockchain & Digital Assets Pty Ltd reserves all rights to set a royalty on secondary sales.
Disclaimer: If you subscribe to BADASL Monthly Mints, or pay to collect BADASL Monthly Mint NFTs, all amounts received into the badasl.eth wallet will be treated as assessable income. You are responsible for seeking independent and professional legal and tax advice regarding your eligibility to subscribe to or collect BADASL Monthly Mints. None of the content constitutes legal, tax, financial or security advice.