Nature of Decentralised Autonomous Organisations (DAOs)
Are DAOs regulated in Singapore?
While DAO's are being assessed by regulatory bodies, they are not currently regulated in Singapore.
The Regulatory Perspective on DAOs
"Providing a regulatory perspective (on an entirely exploratory basis and not in any way representing the views of ACRA), Mr Leong Weng Tat, the Chief Legal Officer of ACRA, named three broad areas worthy of attention. The first is the growth of blockchain – while the technology was initially associated mainly with virtual currencies, today it has expanded to include tokens which provide its holders with various rights, such as voting and equity tokens. This may mean that legislation targeted at traditional corporate forms, such as the Companies Act, will require updating to accommodate these newer entities.
The second area concerns appropriate regulatory responses. Mr Leong noted that adapting our regulations in traditional areas of concerns such as anti-money laundering, remain robust, IT governance will remain important, not least because hacks on newer entities such as DAOs are not infrequent. To this end, a possible approach may be to take reference from legislation across various jurisdictions dealing with areas, such as the regulation of autonomous vehicles, facing similar issues.
The third area of interest focuses on the trends and developments in Singapore. Given that Singapore has embarked on its Smart Nation initiative underpinned by digital society, the trend is that the nation will move towards the path of digitalisation. This means that the accompanying regulatory developments will also be in that direction. As such, there will be the need for a balance to be struck between fostering innovation and ensuring regulatory protection."