1inch DAO Votes to Hire Permanent Legal Counsel from STORM Partners, Sets Historic Precedent
Summary:
The 1inch decentralized autonomous organization (DAO) has chosen to hire a permanent legal team from Geneva-based Web3 solutions provider, STORM Partners, in response to legal challenges resulting from its decentralized nature. The decision was approved by an overwhelming vote of 96.45%. The Swiss firm will provide a comprehensive suite of legal services, such as regulatory compliance checks and governance policy development. The partnership marks a historical precedent as the first direct hire of a legal team by a DAO.
The 1inch decentralized autonomous organization (DAO) has reached a decision via consensus to permanently employ legal consultation services from STORM Partners, a Web3 solutions company based in Geneva. This move is aimed at helping 1inch navigate through intricate legal burdens created by its decentralized operation. The unambiguous voting to secure all-encompassing legal assistance from STORM concluded on January 9, with a resounding majority of 96.45% in favor of this proposal. The set of legal solutions provided by the Swiss firm will cover matters such as compliance with regulations, organizational structuring, crafting governance procedures, assisting contractual affairs, defending intellectual property, and protecting against external litigations.
The key motivation behind the procurement of a permanent legal consultant, according to 1inch’s statement, is the increasing inclination of courts to impose conventional corporate responsibility principles and regulatory demands on decentralized units, as seen in recent legal cases in Europe and America. The DAO mentions impending regulatory threats, potential liability issues, uncertainties revolving contracts, and enforcing rights-related issues that are likely to necessitate legal consultation in the future: “An organization with dreams of shaping finance’s new era and enabling people to manage their wealth must face and resolve its legal issues."
Additionally, STORM Partners will also play a part in formulating internal regulations for 1inch, creating governance procedures and policies “in alignment with the community's decisions." The DAO has chosen to pay an upfront amount of 50,000 USDC as a retainer fee to the law firm.
Nicola Massella, head of the Legal and Compliance department at STORM Partners, during her conversation with Cointelegraph, stated that the involvement of STORM Partners is intended to supplement, not substitute, the community's self-regulatory capabilities:"The community holds full authority over the governance of 1inch DAO, crucially deciding its function and future direction. Our role is to transcribe these decisions into a structured set of standards and legal frameworks."
Though it’s hard to verify this claim, over time, DAOs have brought on board legal teams to handle particular court proceedings, and several law firms are known to promote services for representing DAOs.
The resolution to commission a legal team is largely for preemptive purposes, Massella elaborated to Cointelegraph:"Our goal in proactively tackling these legal issues is to protect 1inch DAO and its members from unexpected legal complications […] Most importantly, we need to deal with the potential personal liability risks for DAO members."
As per the statement released by 1inch, their alliance with STORM marks an “historic first” for DAOs, being the first-ever instance of a DAO directly hiring a legal team.
Published At
1/12/2024 3:01:00 PM
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