Decentralized Autonomous Organization (DAO) in Hong Kong

DAOs have gained more attention in Hong Kong among business people as a great model for collaboration and governance in the past few years. Through blockchain technology, decentralized autonomous organizations provide a community-driven and decentralized approach to managing funds and projects. Typically, these organizations operate without any central authority. It is the most innovative structure that lets participants stay anonymous but still can contribute & raise funds. Hence, it is clear that DAO can be more helpful for you than traditional organizations. It can also help you overcome the drawbacks of traditional organizations.

DAO provides a unique opportunity for businesses and individuals in Hong Kong to adapt to blockchain technology easily. Members can make decisions, unlock financial opportunities, and fund initiatives by holding and trading DAO tokens with greater privacy. Hong Kong is currently a global fintech hub and has adapted to DeFi (decentralized finance) most effectively.

Understanding the benefits of DAOs in Hong Kong might help you stay ahead, whether you are an entrepreneur aiming to be innovative or an investor looking for new areas to invest in.

Is there any association with Hong Kong Limited Company?

In Hong Kong, you can only establish a limited company or a company limited by guarantee, as there is no specific structure for Decentralized Autonomous Organizations (DAOs). Each of these company types offers different features that meet the requirements.

Registering as a private limited company

If a decentralized Autonomous Organization is registered as a proprietary limited company, it becomes a separate legal entity with the protection of limited liability. However, this structure may compromise the decentralization that defines this organization, which is developed using blockchain technology. Also, the organization would have to abide by government regulations and follow traditional corporate rules and procedures, both of which could conflict with the decentralized governance model of a DAO.

Registering as a company limited by guarantee

Registering the Decentralized Autonomous Organization as a company limited by guarantee is the most idealistic approach. Such a structure establishes the decentralized autonomous organization as a unique entity that is highly responsible for its debts and has no share capital. But, this model is suitable for non-profit or charitable purposes. Sometimes, it may limit the ability of DAO to differentiate members’ rights according to the shareholdings. It is a common feature of various DAOs developed using blockchain technology.

The closest entities in Hong Kong that suit the different requirements of various DAOs are organizations limited by guarantee. Such an organization limited by guarantee doesn’t have any shareholders, and the member’s roles are somewhat different compared to other shareholders in private organizations limited by shares.

The type of company in Hong Kong should be selected based on the client’s needs and the nature of their business. DAO activities, including the issuance and use of tokens in Hong Kong, should follow government regulations and licensing. At that time, those who wanted to start a business in Hong Kong in association with DAO tokens needed help from professionals before proceeding.

How to Set Up a DAO in Hong Kong?

There is no Decentralized Autonomous Organization in Hong Kong. Hence, clients can only start a business as a private limited company or a company limited by guarantee.

What Are the Fees and Timeline for Setting Up a DAO in Hong Kong?

• Our basic fee is around USD 699 for those wanting to start a private limited company. It will take around three to five working days to proceed after getting the necessary documents and completing the compliance procedures.
• Our basic fee is around USD 920 for those who want to start a business with a company limited by guarantee. It will take at least one month to proceed after getting the necessary documents and completing the compliance procedures.

Get everything done within 24-72 hours by registering your company with us.

Business Nature & Activity

Hong Kong doesn’t have any DAO regulations. Hence, decentralized autonomous organizations in Hong Kong can participate in many business activities such as finance, governance, philanthropy, and content creation.

Depending on the business nature and activity, a license may be needed. For detailed information and to verify business license requirements, visit this official resource.

How does DAO operate?

All registered Hong Kong organizations must follow their regulations perfectly. A director and a company secretary must be appointed, and at least one shareholder or investor must receive shares.

After completing the registration, the company should renew it every year without fail, regardless of whether it operates or not.

The owner and director of the company are entirely responsible for all the company matters, such as outstanding filings or clearing all regulation matters and settling any exceptional fees.

Overall, DAOs offer innovative business models in Hong Kong despite the lack of a specific legal framework. Even though private limited companies and companies limited by guarantee are viable alternatives, dealing with regulatory compliance and preserving decentralization remains a major obstacle. Therefore, professionals must help form a successful DAO in Hong Kong.

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