Cayman foundation formations climbed more than 70% year over year to exceed 1,300 by the end of 2024, extending a multi-cycle shift toward offshore structures.
According to a Cayman Finance report, early 2025 data showed that more than 400 additional registrations indicate the trend has continued despite recent moves by the United States to recast itself as a competitive jurisdiction for digital-asset companies.
The foundation model has become the preferred wrapper for decentralized autonomous organizations (DAOs) seeking legal personhood after Samuels v. Lido DAO. This California ruling treated an unincorporated DAO as a general partnership.
While the decision carried limited precedential weight, its signal effect pushed governance projects toward jurisdictions with more apparent separation between contributors and protocol activities. Cayman, long a global center for investment funds, has absorbed much of that flow.
Haymon Rankin, associate director at Cayman Finance, said:
“We’re one of the largest domicile jurisdictions for funds to come here and set up, and people were just—there’s over 30,000 funds at the moment to put it into context. I think the only jurisdiction that’s ahead of us is Delaware. So we really are punching above our weight.”
Indeed, Cayman has attracted major industry entities, including the OpenSea Foundation and subsidiaries supporting cryptocurrency-linked ETFs.
Industry experts attribute this trend to the stability offered by the jurisdiction’s foundation company regime, which allows projects to hold intellectual property, manage multisignature treasuries, and adopt purpose-driven governance frameworks without exposing tokenholders to personal liability.
The liability architecture
The post-Samuels shift reflects a broader recalibration of governance risk rather than simple “regulatory arbitrage.”
Unwrapped DAOs operating without legal personhood face increasing scrutiny from courts, insurers, and centralized service providers.
Foundations offer a predictable corporate interface without requiring tokenholders to act as members or shareholders, reducing the likelihood that plaintiffs or regulators can argue that protocol participants form a general partnership.
Rankin said Cayman’s Virtual Asset Service Providers Act provides additional clarity for companies offering exchange, custody, or issuance services. He said:
“Now there is [a VASP Act], and it really regulates the industry and tells you exactly what you have to do to operate legitimately.”
As a result, the jurisdiction has become a default choice for governance entities seeking legal insulation.
US repositions itself
While capital and governance structures migrated offshore throughout 2023 and 2024, US policymakers have begun shifting toward a more accommodative posture.
The Trump administration has embraced a pro-crypto posture and is focused on strengthening American leadership in the emerging industry.
This is evidenced by its several efforts, including the White House’s endorsement and introduction of the concept of a Strategic Bitcoin Reserve, as well as other moves like the appointment of pro-crypto individuals.
While these moves do not resolve regulatory ambiguities, they signal intent to stabilize a market that had increasingly shifted abroad.
As a result, corporate strategy has already begun adjusting. Galaxy Digital’s redomiciliation from the Cayman Islands to Delaware in mid-2025 illustrates how access to US capital markets can offset the governance advantages of offshore domicile.
Galaxy’s move does not yet represent a wider industry reversal, but it offers an early indicator that a less adversarial regulatory climate may draw some activity back onshore.
At the same time, financial regulatory agencies like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have also taken steps to soften their approach.
For context, the SEC launched the “Crypto 2.0” initiative earlier this year, which led to the closure of several investigations into crypto firms and the development of a comprehensive, clear regulatory framework for crypto assets.
These measures are still in the early stages and require formal rulemaking, but they reflect a shift away from the aggressive enforcement posture that defined the previous administration.
At the same time, regulatory relief has also come through the Corporate Transparency Act.
Earlier in the year, the Treasury Department announced it would not enforce penalties for beneficial ownership reporting by domestic companies while proposing new rules that would narrow the CTA’s scope to foreign reporting entities.
Although not crypto-specific, the change reduces a compliance burden frequently cited by small digital-asset startups operating in the U.S.
A bifurcated operating model takes hold
Even as conditions in the United States improve, the crypto market is fragmenting into jurisdictional layers.
Crypto platforms are increasingly splitting governance and commercial operations to navigate inconsistent regulatory regimes.
Foundations are commonly established in Cayman or Switzerland to hold intellectual property, manage token treasuries, and formalize protocol oversight. At the same time, exchanges, market-facing subsidiaries, and infrastructure providers pursue licenses in jurisdictions with specialized regulatory regimes.
For context, Hong Kong’s Securities and Futures Commission has expanded its virtual asset trading platform licensing program, attracting exchanges targeting Asia-Pacific capital flows. Dubai’s Virtual Assets Regulatory Authority has issued around 30 licenses by mid-2025, with a focus on custodians, OTC desks, and derivatives platforms.
This geographic distribution allows projects to ring-fence governance liability in the Caribbean while acquiring users and liquidity in Asia and the Middle East.
Rankin said the trend is reflected in growing inquiries about “digital asset treasury companies,” or DATs, which manage protocol reserves, liquidity, and fiat operations.
These structures are often paired with US or Asian operating companies, creating multi-jurisdictional arrangements that separate governance, compliance, and commercial functions.
An open question for the new cycle
Whether the United States can meaningfully repatriate foundation-level activity remains uncertain. Offshore jurisdictions still offer clearer liability shields, simpler governance mechanics, and more predictable tax treatment.
However, the US offers unmatched access to public markets, banking, and capital formation, but its policy direction remains dependent on political cycles and incomplete regulatory reform.
For now, crypto companies are hedging. Their operating entities are moving toward Delaware, Hong Kong, and Dubai. At the same time, their governance structures remain anchored in George Town and Zug.
