According to Cointelegraph, the Cayman Islands has experienced a significant increase in foundation company registrations, with a 70% year-on-year rise. By the end of 2024, over 1,300 foundation companies were registered, and more than 400 new registrations have already been recorded in 2025. These entities are increasingly utilized as legal frameworks for decentralized autonomous organizations (DAOs) and as ecosystem stewards for major Web3 projects. The Cayman Islands has become a preferred jurisdiction for many of the world's largest Web3 projects, with at least 17 foundation companies holding treasuries exceeding $100 million.
The Cayman foundation company offers DAOs a legal structure that allows them to sign contracts, hire contributors, hold intellectual property, and interact with regulators, while protecting tokenholders from personal liability for the DAO's obligations. This legal framework gained prominence following the 2024 Samuels v. Lido DAO case, where a U.S. federal judge ruled that an unwrapped DAO could be treated as a general partnership under California law, exposing participants to personal liability. The Cayman foundation company addresses this issue by providing a separate legal personality and the ability to own assets and sign agreements, offering tokenholders assurance that they are not automatically considered partners.
The rise in Cayman Islands foundation company registrations is further supported by tax neutrality, a legal framework familiar to institutional allocators, and an ecosystem of firms specializing in Web3 treasuries. This has led many projects to quietly redomicile their foundations to Grand Cayman. Meanwhile, U.S. President Donald Trump has made ambitious promises to transform the United States into the "crypto capital of the planet," but only a few states explicitly recognize DAOs as legal entities. Switzerland remains a prominent onshore Web3 foundation center, with the Crypto Valley region hosting over 1,700 active blockchain firms, marking a 130% increase since 2020.
The surge in Web3 foundations aligns with a shift in the Cayman Islands' regulatory stance, marked by the implementation of the Organisation for Economic Co-operation and Development's Crypto-Asset Reporting Framework (CARF). Effective from January 1, 2026, CARF imposes due diligence and reporting duties on Cayman "Reporting Crypto-Asset Service Providers," requiring them to collect tax-residence data from users, track relevant transactions, and file annual reports with the Tax Information Authority. Legal professionals note that CARF reporting applies to relevant crypto-asset service providers, including exchanges, brokers, and dealers, but likely excludes structures that merely hold crypto assets, such as protocol treasuries, investment funds, or passive foundations. This means many pure treasury or ecosystem-steward foundations can continue benefiting from Cayman's legal certainty and tax neutrality without full reporting obligations, provided they do not operate exchange, brokerage, or custody services.
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