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Noun 40
@noun40
discourse around DUNA seems to be focused around the downsides (added KYC requirement to grantees) imo DUNA's massive upsides are: - reducing tax risk - providing limited legal liability to members while still allowing: - members to remain anonymous (privacy) - explicit voting rights to members if there are other avenues to achieve the above without any compromises then that would be wonderful, but as far as i know at the moment DUNA is unique in offering the above properties with limited compromises (paying taxes in the US, KYC req for grantees). more thoughts continued 👇
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Noun 40
@noun40
right now our tax position is that we're based in cayman. the nft auctions are permissionless and global but we tie the tax jurisdiction to the cayman islands via the foundation through the IP that it holds and its veto rights to the treasury. it's not a bad position. it's a position we built through good tax and legal counsel. but it has become increasingly tenuous in the 3 year history of nouns as one could attempt to argue that a good portion of the economic substance of the dao occurs in the US (esports, nouns movie, nouns fest, etc; plus many nouns buyers). i would much rather have a clear jurisdiction where we pay taxes (and in a tax year where treasury spend matches or exceeds auction revenue, the tax bill would be minimal) and it would be natural for that jurisdiction to be where the most amount of economic substance (nouns buying, treasury spending) occurs.
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Noun 40
@noun40
also on legal liability, currently it's very unclear what would happen if someone sued a dao member for legal damages (let's say something went wrong with a prop) or gov bring enforcement action for non-compliance with local regulations. the dao member argue that they are the wrong target. they have no responsibility here. the foundation is the one with control over the treasury and conducting the business activity. but this claim is also tenuous. we like to have explicit token voting rights (token votes aren't some signaling vote that is a recommendation to the foundation). if the claim that the dao = foundation isn't accepted then the court might assume the dao to be a general partnership in the local jurisdiction and it could lead to individual members being liable (such claims have been made in the california court in recent years).
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Noun 40
@noun40
this is a hard nut to crack b/c what entity structure allows for explicit voting rights (members make decisions) but limits liability? the typical answer is a c-crop or an LLC (limited liability company) but two problems with that is that we don't want the nfts to be securities (b/c issuing securities is a whole another realm of legal issues plus we don't see the nfts as securities but rather art with certain voting rights). the other problem is that corporate structures typically require the corporation to keep record of the shareholder identities. this would preclude the ability to have anon nouners. DUNA is quite unique here. it's a Unincorporated Nonprofit Association adapted for DAOs. so it's explicitly not a company (thus the token not a security). but still members are afforded privacy, limited liability, and explicit voting rights. quite a unique combination. you can read more about it here: https://a16zcrypto.com/posts/article/duna-for-daos/
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Ben
@jarmen
One of the most disheartening aspects of this is the allocation of dao resources before any governance signal. The finding is now presented like it's up to Dao governance to shift the back pillar. Which feels a lot like theatre. And the outcome is already set in stone.
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Noun 40
@noun40
this is absolutely one of the things i hate the most about the current setup. but the more tenuous things you have to maintain and juggle the less transparent you can be. hopefully if we get to DUNA things can be better. this where we pay taxes and why. nouns isn't a security and this is why. we have limited liability because X. the opaqueness of the foundation navigating tax and legal risks is not a new phenomenon regarding just this transition decision. it was always that way due to the tensions its been navigating (if you remember in the nouner discord this was also a complaint back then) so if it feels like theater then yeah this aspect has been more theater like since the beginning. hopefully we can do better but i think whether we can be more transparent and clear depends on if you can get to a setup that doesn't require mental jiujitsu
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Noun 40
@noun40
sorry didn't mean to be negative towards your comment! it's fair to feel frustrated about the foundation's communication. but it's also just hard.
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Bixbite 👽
@bixbite
There’s no reason why transparency can not happen now…. The past is the past, you have to remember there was literally an 18 month DAO heist operation going on, so yea, things might have been tense…. But this is a new DAO, those people are all gone and a large majority of the people involved have good intentions, but the lack of transparency will cause unnecessary panic & doubt.
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