New figures reveal a 70% year-on-year increase in foundation company registrations in the Cayman Islands, with more than 1,300 on the books at the end of 2024 and more than 400 new registrations as early as 2025.
These structures are increasingly used as legal wrappers for Decentralized Autonomous Organizations (DAOs) and as ecosystem managers for large Web3 projects.
According to a press release from Cayman Finance, many of the world’s largest Web3 projects are now registered in the Cayman Islands, with at least 17 founding companies with coffers in excess of $100 million.
Why DAOs choose Cayman
The Cayman Foundation has emerged as the preferred tool for DAOs that need to sign contracts, hire collaborators, own IP, and communicate with regulators, all while protecting token holders from personal liability for DAO liabilities.
A legal wake-up call for many communities came in 2024 with Samuels v. Lido DAO, in which a US federal judge found that an unwrapped DAO could be treated as a general partnership under California law, exposing participants to personal liability.
Founder Cayman is designed to fill that gap, offering separate legal personality and the ability to own assets and sign contracts, while giving token holders the comfort of not being partners by default.
Add to that tax neutrality, a legal framework familiar to institutional allocators, and an ecosystem of companies that now specialize in Web3 treasuries, and it becomes clearer why more projects have quietly moved their bases back to Grand Cayman.
Elsewhere, policy makers have made big promises but delivered on them. Donald Trump has repeatedly promised to turn the United States into the “crypto capital of the planet,” but at the entity level, only a handful of states specifically recognize DAOs as legal entities.
Switzerland remains the archetypal core Web3 center on the mainland, with the Crypto Valley region now hosting over 1700 of active blockchain companies, more than 130% since 2020, with foundations and associations representing an increasing share of new structures.
Related: Switzerland’s crypto valley to reach $593 billion with 17 unicorns in 2024
From lightweight haven to compliant player
The rise of Web3’s foundation coincides with a change in Cayman’s own regulatory stance, s arrival The Organization for Economic Co-operation and Development’s Crypto Asset Reporting Framework (CARF), which the Cayman Islands have now implemented through new Tax Information Authority regulations effective January 1, 2026.
CARF will impose due diligence and reporting obligations on Cayman “Crypto Asset Service Providers” (entities that exchange cryptocurrencies for fiat or other cryptocurrencies, operate trading platforms or provide custodial services), requiring them to collect tax residency information from users, monitor relevant transactions and submit annual reports to the Tax Information Administration.
Legal experts note that CARF reporting as currently interpreted applies to relevant service providers of crypto assets, including exchanges, brokers and dealers, which likely leaves out of the network structures that only hold crypto assets, such as protocol treasuries, mutual funds or passive foundations.
“The key question is whether your entity, as a business, provides the service of carrying out exchange transactions for or on behalf of customers, including acting as a counterparty or intermediary or making available a trading platform.”
In practice, this means that many pure treasury or ecosystem-managed trusts should be able to continue to benefit from Cayman’s legal certainty and tax neutrality without being drawn into full reporting status, as long as they are not engaged in the business of running exchange, brokerage or custodial services.
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