This list of questions was prepared to provide further information related to Code4rena's governance proposal forming as a Wyoming Unincorporated Nonprofit Association.
However, please feel free to post any additional questions or comments in the Github discussion as we discuss the merits of the Governance Proposal.
The lack of a legal entity could distract from the core mission of Code4rena and could hinder future growth and opportunities to serve more mainstream organizations.
In the United States, typically, when two or more persons join by mutual consent for a common lawful purpose, organized not for profit, they have created an unincorporated nonprofit association. Unincorporated associations historically possessed no legal existence apart from their members. In recent history, many jurisdictions, including Wyoming, have conveyed varying degrees of legal entity status through statute and case law
By conveying legal entity status or elements of legal entity status for particular activity, the UNA can help solve some of the biggest challenges facing entityless DAOs:
There are a variety of options available for DAOs and we believe establishing as an UNA is the right one for us. Further discussion on the topic can be found here and here.
The UNA is best thought of as a tool that provides the DAO a path for its internal governance to interact externally through its Governance Proposals. The UNA merely creates a legal layer on the existing DAO and can only act as authorized by the DAO through Governance Proposals.
By utilizing the Governance Proposals to direct its activities more specifically, Code4rena takes a big step forward in increasing its decentralized governance. Under the Association Agreement of the UNA, no members of the DAO are authorized to act on the DAO's behalf, but the DAO may authorize the UNA or its administrators to take certain actions. Future Governance Proposals will be executed as needed to authorize administrators of the UNA to execute specific tasks or engage 3^rd^ party service providers to perform tasks on the DAOs behalf.
Additionally, the UNA does not cause any tax obligations in and of itself -- rather, it provides an avenue for which tax filings can be made and taxes paid on behalf of the DAO for existing obligations, instead of potentially passing through to the individual members themselves.
The UNA itself possesses no authority absent authorization from the DAO and the tokenholders. Tokenholders, through Governance Proposals, can authorize the UNA or administrators acting on the UNA's behalf to perform certain activities. These activities can be narrowly tailored or provide broad authority as defined by the Governance Proposal -- however, it is the intent to utilize narrowly tailored authorizations consistent with decentralized governance. The UNA is particularly helpful in performing activities that require a legal entity, which the DAO could not perform without the UNA. Such activities may include: