Having our financial lives always online with crypto is a blessing and a curse.
Total strangers can share resources and move faster. Office hours are a thing of the past.
With computers to handle promises (smart contracts), we can deal with each other and scale against our collective trust issues.
But what happens when things go wrong? Who is responsible for taxes?
Financial history is everywhere, and our transactions are open to plaintiffs and governments.
Needless to say, liability has not been fixed by crypto. It is an annoying but accepted fact that blockchains record and execute transactions but people provide the content, and can often come to disagreement and avoid their responsibilities.
Legal setup for crypto users, however, is often a manual ordeal that introduces hidden costs — people are not sure what types of structures can work for them and how to approach their registration. They get tossed around by lawyers. Yet, we all seem to agree that legal services should be simple, affordable and very repeatable.
To this end: We should all build on the best tools the Internet has to offer. It should be a clear process.
Wrappr is a new product from the Kali DAO team that solves this pain point for crypto, bringing digital life closer to the real world by making incorporation always online — built on well-tested crypto legal structures, secured by smart contracts.
At its core, Wrappr is designed to solve the legal persona problem for DAOs and other internet natives. By leaning into the same technology that it aims to serve, Wrappr radically reduces the steps to attach legal protection to online entities. And it’s never closed on the weekends.
As an initial offering, you can spin up entities like an LLC or non-profit (UNA) in a few clicks. These will be attached to your wallet or DAO using our tailored legal templates and filings.
LLCs are the most common for digital investment clubs and companies, with examples such as The LAO and Raid Guild growing with their investors and clients.
Alternatively, UNAs are frictionless (i.e., no filing) ways to establish 501(c)(3)-eligible communities with limited liability, with examples such as LexDAO and IdleDAO platforming entirely new kinds of mission-driven cooperation.
Drawing from these sources with real stakes and people, these structural types have been honed into Wrappr templates that are signed and tokenized through our onboarding process.
For LLCs, you don’t need to hire agents or lose any privacy by using the novel option of operating “series”, which allows users to enter into Wrappr LLC Operating Agreements and become their own entities in a larger network of wallets.
Delaware and Wyoming registration is handled on the backend as the leading jurisdictions for businesses and DAOs.
State-less charters are also hosted on Wrappr, based on templates provided by LeXpunk Army and Orange DAO — which are a way to set terms for a group without deciding on a formal legal entity.
After you have landed on your preferred entity option, the Wrappr app performs name registration checks, completes signed paperwork, and publishes entity information on the blockchain and IPFS. Simple as that.
As a proof of your Wrappr launch, you get a digital collectible (NFT) that represents your legal agreements and entity creation — viewable in a gallery of other tokenized entities. And the best part: This is all accomplished in minutes rather than days or weeks.
You can now open a bank account, pay invoices, participate in DAOs and operate your digital life with the protection of a legal persona. It also shows up in your wallet, making it clear to anyone dealing with your account that you are operating under the terms of your persona and not personally.
But Wrappr is also a system for creating different kinds of legal wrapper templates and deals (such as SAFE/T, RWA, Security Tokens, etc.), permissionlessly (see our make page, to be elaborated in future articles), allowing for quick iteration to meet the market’s demands. After all, the hive mind is greater than any law firm or company and we intend to harness it.
Did we mention that you don’t actually need to talk to anyone or give away private info to tap into the law?
But if you want to, for example, if you need help with setting up banking or filing tax forms, we are integrated with the LexDAO Clinic who are ready to help.
We are thrilled to bring Wrappr to the Internet and provide a much needed upgrade to the legacy incorporation system.
Structures should be future proof. They should include tools for owning and organizing as much as they represent an agreement or registered entity.
To this end, the Kali DAO team designed a new voting primitive, ERC115V.
ERC115V is the first implementation of a voting extension to the “multi-token” standard interface. As a base for Wrappr legal NFTs, it gives the greatest optionality for these structures to evolve and give on-chain governance rights over time. The code is also highly optimized for gas efficiency and performance, built on the base of the Solmate Solidity library. Basically, when your wallet or multi-sig holds a Wrappr NFT, you have an easy path toward a DAO.
ERC1155 tokenization is desirable for legal entities and assets especially because it allows unique metadata to be associated with each token (ID), such as entity filings, operating agreements, and investment terms. But the true power lies in ERC1155 flexibility. As a generalist interface, we believe it will increasingly become the dominant implementation for tokens and DAOs, as users will want both fungible balances to record network credit and the ability to assign unique NFT-like badges.
In the Wrappr ERC1155V, token metadata is upgradeable by each ID “owner”, which is registered with a mint of a new Wrappr legal NFT, allowing for flexibility to maintain compliance with relevant jurisdictions and to make necessary amendments to legal agreements attached to each token.
For example, a multi-sig or DAO might wrap itself into Wrappr LLC, and then want to attach new terms to its LLC agreement to reflect changes in its membership requirements, such as a revised code of conduct. This is simple and secure using the Wrappr authorization scheme. Similarly, transfers can be restricted wholly or on a per-account-basis, allowing organizations to carefully design rules on transfers for regulatory considerations.
Most importantly, ERC1155V builds on and extends the Compound governance framework for tracking token balances and delegation rights, with the improvement of using timestamps rather than block numbers to provide compatibility for cross-chain transactions (for example, block numbers will vary between different blockchains).
ERC1155V is deployed on every major network at the same address (ERC1155v.eth), and instances of Wrappr templates and new deployments will have identical accounts using CREATE2 (i.e., cryptographic magick).
ERC1155V is designed to scale with the needs of the real world.
Many people will see Wrappr, and think, Finally. It is no secret that incorporation is a standardized process, but yet it lacks good UX. Until the advent of blockchains, the recordkeeping and signature collection process has resisted true automation.
Here’s the thing: While the blockchain is mostly associated with trading tokens, it is actually a legal technology. This unironically changes everything (for lawyers).
Every transaction on a blockchain is signed by its participants. Public key cryptography is a relatively old technology for proving digital authenticity. Thus, with wallets and smart contracts to preserve and execute legal agreements with timestamps, we have the ingredients for better privacy and rapid registration because proving who, what, and when is automated.
With the additional security of blockchains, we can guarantee that every agreement and structure created on Wrappr will be permanently readable (by humans and machines), eliminating the risk of servers losing critical data about organizations.
But it must be emphasized, Wrappr is not only for blockchain users.
It is legal tech for everyone. There is a real access problem that we aim to solve by meeting people where they actually do business and gather around shared values — the Internet.
It should be basically free to prove your organization structure to the public and benefit from jurisdictions that offer incentives and protection.
For this reason, Wrappr is on every major blockchain and database that supports smart contracts: Ethereum, Arbitrum (including Nova), Optimism, Polygon, Gnosis, Fantom, Avalanche, Binance Smart Chain and Goerli (testnet).
It is also platform agnostic: Use a Kali DAO, Gnosis Safe, Daohaus Club, or your personal wallet for legal personas. All that is required is the ability to log into the Wrappr app or call its backend smart contracts.
To start, Wrappr only requires a wallet. Users can assign their legal NFTs, as well, to DAOs through the entity creation form.
Fees are nominal, to maintain registration off-chain (initially $25 in ETH for LLC and free for non-profits and charter organizations).
Upcoming updates will abstract wallets from the signature collection process as well, only requiring an email, but we are starting with DAOs, crypto workers and other collectives that can immediately benefit from automated legal setup.
Pay attention. Get involved. Stay protected.
Follow us on Twitter (@_KaliDAO) for more updates on Wrappr, contribute to ERC1155V or our Dework bounties, and join our Discord to get the latest from Kali.