This guide was built to help you understand the benefits of incorporating your DAO and how the process of DAO incorporation works. We help you answer questions like:
Why should I incorporate my DAO? In what geographic jurisdiction should I incorporate my DAO? What legal entity type should I choose?
Get all the information you need to make the best decisions for you DAO by reading this guide.
By
MIDAO
January 22, 2025
Imagine a world where online communities aren't just spaces for discussion, but self-governing organizations with shared treasuries and collective decision-making power. This vision is becoming a reality through the intersection of decentralized autonomous organizations (DAOs) and Web3 social platforms like Farcaster, where developers are building tools to transform social channels into full-fledged on-chain communities.
In a recent episode of the Just DAO It podcast hosted by Adam Miller, Travis and Sam from DAOhaus shared their insights on the DAOs and social media intersection.
Traditional social platforms suffer from centralized control and limited community autonomy. As Travis from DAOhaus points out, "Look at all the drama we've seen with subreddits lately." The fundamental issue is that these platforms rely on single administrators or small groups of moderators to make decisions for entire communities.
Current social media platforms face several key challenges:
Farcaster represents a new paradigm in social media. As Adam Miller explains in the podcast: "Farcaster is the leading Web3 social network. It's built on the blockchain and a decentralized network... The main client is called Warpcast, but there are others."
Unlike traditional social platforms, Farcaster channels were designed to be more structured communities. "The team that built them actually designed them to be more like Reddit communities. So, they're a little more structured than just a hashtag," notes Adam.
One of the most compelling concepts emerging from this space is what Travis calls "group chats with bank accounts." As Adam elaborates: "If Facebook Groups weren't controlled by one person, but instead governed collectively and had a shared treasury—that would actually be way more useful—and way cooler—than what Facebook Groups are today."
Farcastles, built by the DAOhaus team, is making this vision a reality. Travis explains their approach: "We have our roadmap broken down into six levels, and we've already delivered Levels 1 and 2. Those first two levels were about connecting our contracts to Farcaster, displaying DAO data inside Frames, and letting people vote on proposals and execute them directly from the Farcastles feed."
The upcoming features include:
One of the most interesting implementations of this technology is the Post Your Ale channel. Travis describes it as "a channel where you can take a picture of the beer you're drinking and share it with your homies." But it's much more than that.
Sam explains their innovative approach to membership: "Post Your Ale has some token gating on an ERC-1155 token called Proof of Drink. The brewery is called Brew.beer—it spun out of Raid Guild. Each beer has a QR code on the label. If you scan the QR code, you can claim a Proof of Drink token. If you have that token, you get membership into the DAO and into the channel."
The project demonstrates how social communities can evolve into productive organizations. As Travis explains: "We brew beers for protocols, DAOs, other communities... A team comes together to design the label. They put together the formula for the beer. They get it brewed and canned."
The underlying infrastructure for these social DAOs is built on Moloch V3 contracts. Sam explains: "Moloch DAO is the baseline for everything. So, we can use that as our data/blockchain layer and then plug in other tooling as needed."
Farcastles leverages Warpcast Frames to create a seamless user experience. As Sam describes: "One of the exciting things about Farcastles is that it's bringing all these pieces together—but in a way that leverages Farcaster and Warpcast as the UI. So now, instead of bouncing between multiple platforms, you can form your little communities and channels, launch a DAO, crowdfund a project, create proposals and vote on them—all right there in your social feed."
Travis provides clear guidance on when to consider transitioning a channel to a DAO:
Travis highlights the power of on-chain governance: "The beauty of blockchain technology is that we can track decisions... Now, we have a historical record of those decisions." This creates accountability and allows communities to build on their past choices.
Adam explains the flexibility of DAO treasuries: "We don't have to know everything upfront. We can see how much money we raise. We can see what kind of engagement we get. We can see what ideas the community comes up with."
Social DAOs enable communities to:
Sam acknowledges the learning curve: "This stuff is really complicated. It can be overwhelming and frustrating. When you're juggling multiple tools, you're bound to experience burnout."
Travis identifies a key challenge: "People are being pulled out of their actual workflows to go interact with a DAO. For example: They're in the middle of something important—but they have to go to another app just to make a decision or vote on something."
The vision for social DAOs extends beyond simple governance. Travis explains: "This isn't just about governance. It's about: What do we want to do as an organization? How do we find our purpose? How do we make coordination more natural—more about the people than the tech?"
Sam outlines the potential for "small, ephemeral DAOs" that represent a more agile approach to decentralized organization. These DAOs can spin up quickly when needed, form teams around specific projects, and raise funds for targeted initiatives. Once formed, they execute on their defined goals and share revenue transparently among participants. Perhaps most importantly, these DAOs aren't meant to last forever—they can dissolve once their work is complete, allowing resources and participants to flow to new opportunities. This model enables a more fluid and purpose-driven approach to organizational structure in the Web3 space.
The intersection of social media and DAOs represents a fundamental shift in how online communities can organize and create value together. Through platforms like Farcaster and tools like Farcastles, we're seeing the emergence of truly autonomous, self-governing digital communities.
As Travis puts it: "We're empowering these cozy corners of Warpcast to be able to raise funds and make real decisions together." This evolution from passive social media participants to active community stakeholders could fundamentally change how we think about online coordination and value creation.
For builders and community leaders looking to explore this space, the tools and infrastructure are already available. The next step is experimenting with these new models of community governance and finding the right balance of social engagement and on-chain coordination for your specific use case.
