Jurisdiction for Crypto Natives

If you look at the Wikipedia page I shared above, pay special attention to those countries that do have taxation but only territorial (you only pay taxes on the money that is generated locally, in those countries). You will notice that some of those countries are absolutely flying under the radar and if you take the time to research the obvious better ones, some of them are an excellent option for digital nomads.

It’s easy to want to go where everybody is, but think about what you really need, make a list, then compare this list to what each of those countries can provide. Singapore is the obvious one but you’ll pay dearly for it. Just like any investment, it’s all about proper research and smart moves that most people aren’t seeing just yet. :slight_smile:

4 Likes

I could totally see the Aragon Network negotiating with nation states in the future.

Imagine the case where in 2025 the Aragon Network’s GDP is $10bn. With that GDP, it would be in the top 140 of all nation states by GDP, and then it starts to be in a position to negotiate.

For example, it may decide to contract a nation state for citizenship services. That nation state may even be able to create a sub-court in the Aragon Network that acts as a superset of the Network for those mixed Aragon/nation state citizens.

In the short term though, my wish would be to have more research on the best jurisdictions for sovereign individuals as of now. Switzerland and Uruguay come to mind, but I’m sure there are others too. I’d love to see a detailed overview of the pros and cons of all of them.

5 Likes

Amazing thread. I recommend taking a look at this book I am reading at the moment, specially the chapters on countries selling passports and the next one on selling diplomatic immunity. Really eye opening to the illusions that expensive lawyers can create :wink:

4 Likes

I guess it depends on your definitions of “best” and “sovereign” :slight_smile: How would you define these things?

Maybe this is something we can crowdsource/ fund through the Community Funding DAO. A table where you can score and rank countries based on various attributes like “cost of living”, “tax rate for non-citizens”, “cost of citizenship/ passport”, “level of freedom”, “quality of life”, etc.

3 Likes

:point_up: this

@exiledsurfer posted a link to an interesting article on ‘chat’ that I think has relevance to this discussion.
https://aksioma.org/James-Bridle-State-to-Stateless

2 Likes

Wrote a little somethin’ related to this discussion: https://write.as/c37pruraggnvjpxs

2 Likes

I think all taxes could switch to a fee-for-use model, like car washes, or a subscription model, like insurance, that isn’t very intrusive.

At a car wash, you aren’t paying a subscription for the place to stay open. You pay only when you use the car wash to clean your car. A similar model can be used for government services that are best fit for this. Take roads for example. Many roads are already paid for with a fee-for-use model. Fuel taxes pay for roads, if you drive then your car consumes fuel and so you pay for roads when you refill your car with fuel. A more direct fee-for-use example would be a toll road.

With insurance, you tell your insurance company what kind of car you drive or where your house is, and they figure out approximately what the items are worth so they can charge you a reasonable premium to protect those assets. Then you pay a monthly premium, and if anything happens to the assets that are covered by the policy, you are compensated with a repair or replacement.

In neither case are individuals required to divulge the details of their financial transactions. Since the services the government offers have nothing to do with the specifics of our financial transactions, there’s no practical need for the kind of invasive financial surveillance they use nowadays for tax enforcement.

An additional benefit of the above models is simplicity. Rather than needing an army of accountants to tell me what I owe, I just pay-as-I-go in the fee-for-service model, as I do when I get a car wash, or pay a monthly invoice in the subscription model, as I do for my insurance.

This maps closely to the “territorial-based taxation” model you describe in your note @GustavMarwin.

2 Likes

I recently came across this website that may be of interest to people on this thread: https://flagtheory.com/

2 Likes

Interesting resource, thanks for sharing.
I think Aragon could potentially select one of those jurisdictions and lobby for it to be friendly to DAOs and its participants.
A lot of people will see this as ‘tax evasion’, but coming from an oppressive country, I see it as the only option.

4 Likes

I forget where I first heard this idea, probably a presentation by Balaji Srinivasan (21 founder). But we can also imagine a DAO that many people have joined by pledging to move to a specific country if it provides a specific package of policies that are favorable to members of the DAO, for example low tax policy or business regulations. In this case, it would be a favorable environment for DAOs themselves. It would be a challenge for each side to make a credible commitment to each other but it’s not an impossible scenario to imagine. We just have to think about the benefits for host countries, presumably increased economic activity and a reputation boost but that remains to be seen.

1 Like

I completely concur with your idea (or Bajali’s). What you are describing is a tax treaty. Unfortunately, such treaties are not common anymore, or restricted to very wealthy individuals.
A DAO like this would level the playground for many citizens to get together and get the same treatment as if they were a wealthy individual.

3 Likes

A tax treaty would be completely feasible once the Aragon Network reaches a certain size. I think this is one of the main advantages of using Aragon over other structures: the governance aspects allows for collective bargaining that will be extremely useful.

I believe the crypto space is probably already big enough for some countries to actually start thinking about opening up. What is missing is pretty much the lobbying power for which a single negotiator is necessary. Aragon could potentially play a very important part in this

3 Likes

Hey @Fran23, welcome on the Aragon forum!

I agree with you, I’d also say that one “tool” that’s missing to achieve our goals here, is some kind of Newsroom around this specific subject at the crossroads of blockchain, decentralisation, legal framework, residency, etc. I believe thought it and the “investigations” / research in would generate, it would increase our understanding of how all those things interact, which would then help us take the right decisions to achieve our goals. This would also be useful as a way to bring light to some of the things that are of importance to us, to our community, such as other projects or initiatives which wouldn’t necessarily belong on here on on the blog.

I must say that am slightly biased here as I am currently spending some time on the Civil project (https://registry.civil.co/registry/in-progress/) that I find extremely important in the ecosystem. I’m not in the journalism myself but I would be happy to spend some time on making this happen on Aragon, such as by contributing to the research (that I do for myself anyway) and voting for freeing some tokens for “Aragon News”.

btw, I don’t know how many people are aware, but we already have a little something in that direction, we just need some progress to make it more… lively!

https://monthly.aragon.org/guides/guide_for_submitting_articles/

1 Like

Writing articles is definitely something the Coop DAO plans to contribute if successful with our AGP proposal

3 Likes

I would be happy to contribute with some writing for the coop :slight_smile:

4 Likes

Hi @Fran23 :wave:, yes please, that’d be great. Feel free to dm me or start a new post, be great to talk some more re ideas :writing_hand:

Relevant quote from The Sovereign Individual:

Who will the losers be in the Information Age? In general terms, the tax consumers will be losers. It is usually they who could not increase their wealth by moving to another jurisdiction.

4 Likes

@luis Have you published any article with guidelines about bootstrapping a DAO using a conventional corporate entity or foundation? I have experience with offshore incorporation. There are jurisdictions that offer total privacy, no reporting requirement, no residency requirement and little/no corporate taxes. Would it make sense for such entity to operate DAO inception (create a constitution, run the token sale, etc); then transition all operations to the DAO? After the transition, the level of control allocated the operating entity would be limited to the amount of held tokens (if any); or it can be dissolved entirely. The purpose of this would be to protect founders from vultures who, given that lack of settled law around DAOs, may try to go after individuals.

Please tell me if I’m thinking about the problem incorrectly. This may not be required at all but I’m missing pieces of the puzzle. I’m looking for anything useful to read in order to better understand legal paths towards forming a DAO.

I think that’d make sense, except that I think the DAO itself should be the one running the token sale, which would further improve its decentralization.

Is this something you are interested in researching more? Do you have a legal background? Feel free to ping me on https://aragon.chat, my username is luis

1 Like