- Legal Defense Fund Addresses Operational Continuity and Contributor Protection
- Precedent Set by MakerDAO Inspires Sushi DAO’s Decision
In light of the ever-evolving international regulatory environment for Decentralized Autonomous Organizations (DAOs) and the limited insurance options available for contributors, Sushi DAO has proposed the creation of a $3 million USDT legal defense fund. This fund aims to cover the legal expenses of core contributors. Previously, in March 2022, Sushi DAO attempted to form a legal entity to minimize liability for both the DAO and its contributors. However, it became clear that a dedicated fund is necessary to handle legal requirements, maintain operational continuity, and protect core contributors.
SEC subpoena :
Sushi DAO and its Head Chef, Jared Grey, were recently served with an SEC subpoena. Although they are cooperating with the SEC, they have chosen not to discuss ongoing investigations or legal issues publicly.
The Sushi DAO Legal Defense Fund will offer coverage for reasonable attorney fees and associated costs for core contributors who have been active since the ratification of Sushi 2.0 up to the present. Disbursements from the fund will continue until all legal proceedings have concluded. The $3 million USDT will be stored in a newly created multisig account, ensuring funds are accessible for legal representation when required.
How the Legal Fees are Financed ?
To finance the legal defense fund, Sushi DAO will rely on a combination of Kanpai fees (50%), grants (35%), and Sushi market sales (15%). If the fund is exhausted, the DAO will provide an additional $1 million USDT as needed, and financial disclosures will be offered through the Governance Dashboard (set to launch in Q2 2023). Sushi DAO’s decision is in line with a recent precedent established by MakerDAO, which formed a comparable legal defense fund to manage liability for its core contributors.
Funds will come from a combination of the following:
- Kanpai fees (lump sum): 50%
- Grants (BD revenue): 35%
- Sushi (TWAP market sells): 15%
Conclusion :
SEC has been going after ever other crypto company. Its matter of time either they give up US for good and move to other crypto friendly countries of Duabi, Singapore or Hong Kong
Suggested Reading :
- Why more than 80 Crypto Companies Flocking to Hong Kong?
- Hong Kong plans to make crypto purchase and trading legal for all of its citizens
- Crypto Industry is Under Siege by Regulators
- Why is Dubai an Attractive Crypto Oasis?
- India Requests IMF and FSB to Develop ‘Synthesis Paper’ on Crypto Assets during G20 meeting
