Before we can guide towards the best setup for investing it is important to know whether you'll be investing your own money or whether you will be investing on behalf of outside investors.

When investing funds other than your own, Otonomos guides towards setting up a fund structure which gives the Manager to the fund certain protections. One of the main functions of a fund setup is the dual share class. 

The dual share class reflects Manager shares and Particiaption shares. The Manager shares give the right to make investment decisions while the Participation shares only give participation rights as the investor.

Investing for friends and family is something that does fall under the category of investing on behalf of others. It is ultimately up to the investment Manager to decide whether a full fund setup is required or whether a Proprietary Trading Entity is initially enough to build a track record.

The trading strategy for your Proprietary Trading Entity determines which entity type is best.

If you are looking for an entity to do your DeFi magic, there are a few interesting options to look at. The most attractive options are, a BVI Limited Company, a US LLC, or if you are looking to move your residency a Dubai DMCC Freezone company could be ideal for you. 

Alternatively registering an onchain entity with OtoCo is an option that may work for you if you do not need banking or a centralized exchange account. 

Learn more about your options below:

You can register a traditional entity to conduct DeFi trades through, if done through a US LLC or a BVI company you can establish a track reccord for your trades profitability. This allows for an easy pathway to upgrade into a fund if you are wanting to one day take on outside investors.

If you are looking to relocate to a crypto friendly jurisdiction to conduct your DeFi activities out of Dubai is an attractive option. A DMCC Freezone company can allow you to apply for a visa and become a resident under their attractive tax regime. For citizens of countries like the United States that have global taxation there are no taxation benifits doing this. 

OtoCo allows you to spin up a US Series LLC within seconds on Ethereum or Polygon. The first Member (shareholder) of your entity will be the wallet address which you use to spin up the entity. 

From within the dashpanel you can spin up a wallet which is owned by your entity. This wallet can be used to stake, trade and yield farm on Ethereum and Polygon.

OtoCo is perfect as all your trades are onchain and there is no need for the setup of an exchange account.

A fund that invests in SAFTs, SAFTE's and SAFE's with Warrants on behalf of outside investors is generally known as a close ended fund. This means that investments can only be done at the launch of the fund and redemptions can only be done when the fund is closed down.

Instead of making use of a Limited Company it is more common to make use of a Limited Partnership.

The best jurisdiction to do this from depends on if you will be investing in offerings that are not available in the US.

Will you need access to any derivatives or highly leveraged products? This means that your entity should be registered in an offshore jurisdiction.

Unfortunately for American citizens having an offshore entity will not grant you access to offshore derivative exchanges as they restrict access to American citizens in general.

Will you need access to any derivatives or highly leveraged products? This will require access to an exchange account outside of the US.

This means that your fund should be registered in an offshore jurisdiction. 

To open offshore exchange accounts it is required to set up an offshore entity. Otonomos sees the British Virgin Islands as the best value jurisdiction to register your proprietary trading entity. 

Alternatively Dubai could be an attractive option if you are looking to become a resident under their attractive tax regime. A Dubai DMCC company can get a crypto commodities trading license allowing you to trade without any regulatory uncertaintiy.  

To open offshore exchange accounts it is required to set up an offshore entity for your crypto fund. Otonomos sees the British Virgin Islands as the best jurisdiction to register an investment fund due to the limited initial setup requirements.

If you do not want to set up an offshore fund,  you can learn more about setting up a US Private Fund which is a great vehicle to start investing on behalf of outside investors.

A British Virgin Islands Limited Company is best if you are looking for a low cost prop trading entity in a tax optimized jurisdiction. This is the best value setup to build a track record before upgrading to a full fund structure.

Offshore Exchanges

A BVI entity will also give access to the international version of exchanges instead of the limited versions in the US. This allows for trading strategies that require the usage of derivatives or options.

Upgrade to Investment Fund

Your BVI prop trading entity can also be upgraded to an investment fund to take on outside investors. The BVI allows you to register a so called Incubator Fund which is a low cost setup without the need for an outside custodian or fund admin. 

This makes the BVI prop trading entity a great vehicle to build a track record before you start investing on behalf of other investors.

The British Virgin Islands are a very cost effective vehicle for an offshore fund setup compared to the Cayman Islands. 

BVI Incubator Fund

In the BVI you can start a so-called Incubator Fund with an AUM up to $20 million with lower initial setup costs. This is because there is no need for a outside fund admin or custodian. This allows you to build a track record before you can graduate your fund into an "Approved Fund". 

The Incubator Fund can be operated for 2 years with the option to extend with 1 year. After that the fund needs to be upgraded to an Approved Fund. 

BVI Approved Fund

Graduating your fund into an Approved Fund is also a fairly streamlined process. The only additional requirement is the need appoint an outside fund administrator. The Approved fund allows you to run a fund up to $100 million once upgraded.

Feeders

BVI Funds are great for international investors but it is not common for Americans to directly invest into a BVI Fund as the reporting requirements for Americans holding equity in offshore companies is overly burdensome.

To accept US investors it is required to have a US Feeder which "feeds" into the Master Fund in the BVI. The US Feeder is essentially a US Private Fund which counts as one investor in the BVI Fund.

Offshore Exchanges

BVI Funds are great if your trading strategy involves the usage of derivatives or options as you will have access to the various non-US exchanges that have these trading options.

Otonomos works with US counsel who works hand in hand with BVI counsel to get the right documents in place to accept US investors. Click the button below to setup your BVI Fund with US Feeder.

A Delaware LLC is the right entity for you if you are looking to do your proprietary trading with a low cost set-up. Delaware is preferred as your entity can be upgraded to a private fund.

Banking and Crypto Exchanges

US LLCs also allow you to fairly easily open a fiat bank account where you can run expenses related to your prop trading company. Besides that, there is access to a large number of exchange accounts as well.

Upgrade to Private Fund

Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This makes Delaware the best jurisdiction if you want to upgrade your proprietary trading entity into a US Private Fund to take on outside investors. 

Setting up a US private fund is a fairly straight forward process. Otonomos can assist with the upgrade once you are ready for the next step.

US Private Funds are great investment vehicles for US and international investors alike. This type of fund setup is for those employing DeFi strategies and strategies not based around leverage or derivatives. 

US Private Fund Documents

US private funds give investors the confidence they need that your fund is in a jurisdiction where they are protected by a strong precedence of legal cases established by other funds in the state of Delaware. 

Otonomos works together with US counsel to finalize your US Private Fund Operating Agreement for you to start accepting investments.

Exemptions

As the United States has well defined securities regulations it is important to know what you can and can't do. This means that you cannot invest in unregistered securities including security tokens. Besides that there are regulations around Accredited Investors and Investment Advisor licenses.

Our partner counsel can assist with drafting these exemptions in a separate engagement if required.

Accredited Investors

Being in the United States also means you will have to consider accredited investor regulations.

There are safe harbours like Rule 506D which allows you to accept unaccredited investors. This does mean for instance that you are not allowed to market your fund.

Registered Investment Adviser

To manage funds in the United States it is required to have a Registered Investment Adviser. 

However, when managing a fund below $25 million it is not required to register with the SEC. Therefore there are exemptions to manage funds in the United Stated without being a Registered Investment Advisor.

When making investments in illiquid products like SAFTs, SAFTEs and SAFEs with token warrants or if you are looking to take equity it is most common to setup a Limited Partnership. 

The Limited Partnership setup gives the General Partner control over the assets and the investment decisions. The investors will come in as Limited Partners and have no say in management of the investments.

Delaware is the most common jurisdiction to register investment related entities.The LP setup in Delaware will give investors the confidence they need that your fund is in a jurisdiction where they are protected by a strong precedence of legal cases established by other funds.  

Setting up an Illiquid US Investment fund does require input from US counsel. As the cost for this can run up by a lot it is best to organize an initial call to make sure we can give the right guidance.

When making investments in illiquid products like SAFTs, SAFTEs and SAFEs with token warrants or if you look to take equity in projects it is most common to setup a BVI Private Investment Fund.    

BVI Private Investment Fund

The BVI Private Investment Fund is a fairly new fund type that the Financial Service Commision has launched to cater to the ever increasing need for illiquid fund setups.

Limited Partnership

The most common entity structure to set up your Private Investment Fund is in the form of a Limited Partnership. This setup gives the General Partner control over the assets and the investment decisions. The investors will come in as Limited Partners and have no say in management of the investments.

As the Illiquid Offshore Fund Setup is very specific, it is best to organize an initial call to make sure we give the right guidance.

The nature of the token is important to determine when issuing a token. A token that is explicity a security can carry additonal risks and has limits on who it can be offered to. 

Issuing a token is best done from a Special Purpose Vehicle which is only created to issue the token. The SPV is important as it leaves liability that comes with issuing the token at the token issuance entity.

Before we get into that, we need to know whether the token has already been created.

Issuing a token is best done from a Special Purpose Vehicle which is only created to issue the token. The SPV is important as it leaves liability that comes with issuing the token at the token issuance entity.

When issuing a security token it is even more important to have the SPV as issuing a security token can trigger alarm bells at regulators. 

Before we get into that, we need to know whether the token has already been created.

If the Security Token has been created, the best option is to use a Launch Pool to offer your token. 

The Launch Pool is a completely transparent way to raise capital for your investors. The Launch Pool is Pioneered by OtoCo.io.

The location where the token will be offered needs to be determined before choosing where the SAFT will be issued from. This is because the location where the token is offered is more important than issuing location.

As the United States has well defined securities regulations it is important to know whether the tokens will be offered inside or only outside of the US.

The location where the token will be offered needs to be determined before choosing where the SAFT will be issued from. This is because the location where the token is offered is just as important as where it is being issued from. 

As the United States has well defined securities regulations it is important to know whether the tokens will be offered inside or only outside of the US. Currently the US is interpreteing most token sales as the sale of a security regardless of its true nature. We do see change on the horizion but many teams are currently resticting access to their sale from the US or only selling it to accredited US investors.

Often when selling to US investors they will look more for token warrants rather than  

As investors traditionally hold equity, a SAFTE is a good instrument to give your investors the comfort of recognizable investor docs with the option to also get tokens.

As the United States has well defined securities regulations it is important to know whether the equity and/or tokens will be offered inside or only outside of the US.

As investors traditionally hold equity, a SAFTE is a good instrument to give your investors the comfort of recognizable investor docs with the option to also get tokens.

As you are looking to issue a securities token it is important to know whether the equity and/or tokens will be offered inside or only outside of the US.

As investors traditionally hold equity, a SAFE is a good instrument to give your investors the comfort of recognizable investor docs with the option to also get tokens.

As the United States has well defined securities regulations it is important to know whether the equity and/or tokens will be offered inside or only outside of the US.

As investors traditionally hold equity, a SAFE is a good instrument to give your investors the comfort of recognizable investor docs with the option to also get tokens.

As the United States has well defined securities regulations it is important to know whether the equity and/or tokens will be offered inside or only outside of the US.

When doing an Airdrop to reward your community it is still best to do the Airdrop from a Special Purpose Vehicle to leave liability with the issuing entity. 

In addition to rewarding your community of users and builders with an airdrop, you can also pre-sell your tokens through a SAFT (Simple Agreement for Future Tokens) or a similar mechanism like a Token Warrant. This approach allows you to secure funding for your project while simultaneously building and incentivizing your community.  

Before the token has been distributed to the community, a Foundation can be registered to be the treasury of the project and be the vehicle from which a DAO takes action from.

As the main purpose of the entity is issuing the token there is essentially no need to renew the entity the year after the token has been issued unless you have a planned for continued issuance

The regulatory space in the BVI is favourable for Airdrops and token distribution more broadly. Otonomos sees the BVI as the preferred jurisdiction to register your Special Purpose Vehicle to Airdrop the tokens from. 

Issuing a SAFT from a US LLC is the most cheap and cheerfull way receive initial funding for your project without having to already issue the token. Once the token is created they can be issued from the same entity that issued the SAFT.  

The Delaware LLC is the preferred state to register the SPV for your SAFT issuance. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFT investor ready so your project can start the fund raise!

Issuing a SAFT from a US LLC is the most cheap and cheerful way to receive initial funding for your project without having to already issue the token. Once the token is created they can be issued from the same entity that issued the SAFT.

As you are looking to issue a security token in the US it is very important to comply with US Securities regulations. Therefore, it is best to connect with US counsel to assist with any required licensing.

Otonomos works together with US counsel who can assist with this if needed.

As for the entity, the Delaware LLC is the preferred state to register the SPV for your SAFT issuance. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFT investor ready so your project can start the fund raise!

Issuing a SAFT outside of the US is the preferred option to prevent being caught in US Securities regulations. To ensure this, the United States needs to be geo-fenced out of the offering since offering and issuing the tokens inside of the US will still get you on the SEC's radar.

The best offshore jurisdiction to issue a SAFT is the British Virgin Islands. The BVI Limited Company offers best value to issue and (pre-)sell and distribute your tokens from an offshore entity. Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

Otonomos can assist with getting your SAFT investor ready so your project can start the fund raise!

Issuing a SAFT outside of the US is the preferred option to prevent being caught in US Securities regulations, this is especially best if your token will be deemed a Security Token. 

However, issuing the security token outside of the US is not enough. Therefore, the United States needs to be geo-fenced out of the offering since offering the tokens inside  the US will still get you on the SEC's radar. 

Otonomos works together with local counsel who can assist on the requirements to issue a security token.

The best offshore jurisdiction to issue a SAFT is the British Virgin Islands. The BVI Limited Company offers best value to issue and (pre-)sell and distribute your tokens from an offshore entity. Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

Otonomos can assist with getting your SAFT investor ready so your project can start the fund raise!

Issuing a SAFTE from the US is a common way to give investors equity and/or tokens. Since the SAFTE gives this flexibility, it is not needed yet to have an entity in place which can offer the equity. 

It is however most common to already issue the SAFTE from the entity which will also offer the equity.

Issuing a SAFTE from a US C-Corp is the most common way to attract investors and issue equity. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFTE investor ready so your project can start the fund raise!

Issuing a SAFTE from the US is a common way to give investors equity and/or tokens. Since the SAFTE gives this flexibility, it is not needed yet to have an entity in place which can offer the equity. It is however most common to already issue the SAFTE from the entity which will also offer the equity.

Since you are potentially issuing a security token it is important to make sure that you comply with US Securities Regulations to prevent being challenged by the SEC.

Otonomos works with US counsel who can assist with the regulatory work to make sure you stay compliant.

Issuing a SAFTE from a US C-Corp is the most common way to attract investors and issue equity. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFTE investor ready so your project can start the fund raise!

Issuing a SAFTE can be done from an offshore jurisdiction if it is preferred to stay out of the US. This does mean that it is required to have two separate entities:

As the equity will not be given out instantly, the Cayman ELC can be registered at a later stage.  

Issuing a SAFTE will be done from a BVI Limited Company. The BVI entity will also be used to issue the token if and when they are ready for distribution to your initial investors.

Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

The BVI entity is not suitable to issue equity if and when equity will be provided. For the issuance of equity in an offshore company a Cayman ELC is the norm. 

The Cayman ELC is the entity from which equity can be provided to your investors. The reason why the SAFTE issuance and equity issuance are separated is the more strict Virtual Asset Service Provider laws which are applicable in the Cayman Islands.

As you are issuing a security token it is best to stay outside of the US due to the strict Securities regulations. Issuing a SAFTE can therefore be done from an offshore jurisdiction. This does mean that it is required to have two separate entities:

As the equity will not be given out instantly, the Cayman ELC can be registered at a later stage.

Issuing a SAFTE will be done from a BVI Limited Company. The BVI entity will also be used to issue the token if and when they are ready for distribution to your initial investors.

Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

The BVI entity is not suitable to issue equity if and when equity will be provided. For the issuance of equity in an offshore company a Cayman ELC is the norm. 

When issuing a security token it is best to still consult local counsel to make sure you stay compliant with local security regulations.

The Cayman ELC is the entity from which equity can be provided to your investors. The reason why the SAFTE issuance and equity issuance are separated is the more strict Virtual Asset Service Provider laws which are applicable in the Cayman Islands.

Issuing a SAFE from the US is a common way to receive investments with the promise to provide investors equity, the token warrant gives investors the option to buy tokens in the future as well. 

The Delaware C-Corp is the most tried and tested way to issue a SAFE with a token warrant. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFE investor ready so your project can start the fund raise!

Issuing a SAFE from the US is a common way to receive investments with the promise to provide investors equity, the token warrant gives investors the option to buy tokens in the future as well. 

Since you are potentially issuing a security token it is important to make sure that you comply with US Securities regulations to prevent being challenged by the SEC.

Otonomos works with US counsel who can assist with the regulatory work to make sure you stay compliant.

The Delaware C-Corp is the most tried and tested way to issue a SAFE with a token warrant. Delaware is the state where most US Hedge Funds are registered which results in the large amount of legal precedence when it comes to investment agreements. This gives your investors the comfort to invest.

Otonomos can assist with getting your SAFE investor ready so your project can start the fund raise!

Issuing a SAFTE can be done from an offshore jurisdiction if it is preferred to stay out of the US. This does mean that it is required to have two separate entities:

As the equity will not be given out instantly, the Cayman ELC can be registered at a later stage.

Issuing a SAFE will be done from a BVI Limited Company. The BVI entity will also be used to issue the token if and when they are ready for distribution to your initial investors.

Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

The BVI entity is not suitable to issue equity if and when equity will be provided. For the issuance of equity in an offshore company a Cayman ELC is the norm. 

The Cayman ELC is the entity from which equity can be provided to your investors. The reason why the SAFTE issuance and equity issuance are separated is the more strict Virtual Asset Service Provider laws which are applicable in the Cayman Islands.

Issuing a SAFTE can be done from an offshore jurisdiction if it is preferred to stay out of the US. This does mean that it is required to have two separate entities:

As the equity will not be given out instantly, the Cayman ELC can be registered at a later stage.

Issuing a SAFE will be done from a BVI Limited Company. The BVI entity will also be used to issue the token if and when they are ready for distribution to your initial investors.

Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

When issuing a security token it is best to still consult local counsel to make sure you stay compliant with local security regulations.

The BVI entity is not suitable to issue equity if and when equity will be provided. For the issuance of equity in an offshore company a Cayman ELC is the norm. 

The Cayman ELC is the entity from which equity can be provided to your investors. The reason why the SAFTE issuance and equity issuance are separated is the more strict Virtual Asset Service Provider laws which are applicable in the Cayman Islands.

If you would like to do a fund raise in a completely non-traditional and transparent fashion it is worth it to look at OtoGO. With the OtoGO Launch Pool you can reserve a spot in line for the token distribution. The earlier your investors reserve a spot the lower their token price. 

The bonding curve shows exactly what price your investor pays for the tokens as well as the price at which the token was initially offered. 

To create an OtoGO Launch Pool it is required to spin up an entity using your wallet on OtoCo.io. 

While you use OtoCo for the creation of the Launch Pool, the token distribution is still best done from a Special Purpose Vehicle. If you prefer keeping the token distribution out of the US it is best to use a BVI Limited Company to issue the tokens.

The BVI Limited Company offers best value to issue and (pre-)sell and distribute your tokens from an offshore entity. Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

If you would like to do a fund raise in a completely non-traditional and transparent fashion it is worth it to look at OtoGO. With the OtoGO Launch Pool your investors can reserve a spot in line for the token distribution. The earlier your investors reserve a spot the lower their token price. 

The bonding curve shows exactly what price your investors pay for the tokens as well as the price at which the token was initially offered. 

To create an OtoGO Launch Pool it is required to spin up an entity using your wallet on OtoCo.io. 

While you use OtoCo for the creation of the Launch Pool, the token distribution is still best done from a Special Purpose Vehicle. If you prefer keeping the token distribution out of the US it is best to use a BVI Limited Company to issue the tokens.

The BVI Limited Company offers best value to issue and (pre-)sell and distribute your tokens from an offshore entity. Shareholders are not on public record, Directors are as of 2023. Otonomos provides Nominee services to prevent showing up on public record.

As you are issuing a security token it is best to still consult local counsel to make sure you stay compliant with local securities regulations. Otonomos works with local counsel who can provide the required guidance to stay compliant.

Before we give guidance on the best governance structure for your project we do need to make sure whether there is already a token for the project. 

If the token has already been created but not distributed yet it is best to have a look at setting up a token issuance entity. The reason that there is a need for a separate token issuance entity is the risk comes with issuing a token. 

By having a dedicated Special Purpose Vehicle for the token distribution, it will leave liability with that entity. This prevents that the project as a whole will be liable for issuing the token if the project ever gets challenged.

If the token has already been created and distributed to investors and users it is time to look at setting up a structure to govern the project. This can be done through an unincorporated or incorporated structure. 

Incorporated Governance vs Unincorporated Governance

The Unincorporated DAO is the most decentralized way to run a project. This does however come with risk. Having an incorporated structure provides founders and contributors a limited liability wrapper which offers more protection than an unincorporated DAO. Therefore Otonomos guides towards using the incorporated way to govern your project.

An unincorporated DAO is essentially a group of people with a common goal and a multi-sig wallet. OtoCo.io offers a quick and easy way to create an unincorporated DAO within seconds.

OtoCo gives you a dashpanel from which additional plugins can be added. The following plugins can be created to start governing and operating your DAO:

The Cayman Islands Foundation is the preferred entity structure when going for an incorporated governance structure. The great thing about the Cayman Island Foundation is that it can be registered as a Memberless and Founderless Foundation. Having a Memberless and Founderless foundation essentially means that the decision making is done by the token holders of the project. This is great for decentralized projects.

Once the token for the project has been distributed to initial users and/or investors, it is time to move the token balance to the Foundation. From there, the Foundation will be the steward of the project by holding funds and making distributions after votes have been completed.

The Cayman Foundation gives flexibility in how the project will be governed. While the entity can be registered as a Memberless and Founderless Foundation, there will still be the need to appoint a Director to execute the decisions that have been made. Most projects appoint a Nominee Director. The Nominee Director is there solely to execute decisions  and does not have any involvement in the decision making. 

The Foundation has the ability to give out grants after the token holders have agreed on a vote. The grant is a powerful way of distributing funds as they are seen as a gift rather than income. This makes it a great way to fund your operational entity and developer studio which are used to make payments to the legacy world. 

The operational entity can then be used to pay employees, AWS servers and all other monthly expenses which can only be paid in Fiat. 

Besides giving grants to the Operational Entity of the project, it is also possible to provide grants to partner projects. This is a great way to help the project grow.

Registration of the Cayman Islands Foundation is best done before the tokens are ready for distribution. If there is still further guidance needed on the issuance of tokens, Otonomos is happy to help with this as well. To learn more about token issuance you can use this same flow to get the right guidance

Setting up an Operational Entity can be done in a number of Jurisdictions in regions all around the world. 

Otonomos often guides towards to have your operational entity in a location where part of the team is physically located.

Alternatively, we can assist with setting up your Operational Entity in a different jurisidiciton if it is more favourable for your fundraising efforts.

The best location to register cheap and cheerful Operational Entity is actually the United States.

Effecient Taxation

The US LLC is seen as a pass through vehicle which has its benefits. Because of this pass through nature, the US LLC is the perfect setup for Operational Entities and Developer Studios. Key is that the entity is only funded with enough funds to make all the payments.

Banking

The vast amount of banking providers and crypto exchanges is another reason why the United States is a great location to register an Operational Entity. Having access to banking and crypto exchanges makes it easy to offramp crypto into the entity's bank account to easily make Fiat payments.

The Wyoming LLC is seen as the preferred location for the Operational Entity as Wyoming is crypto friendly and they have good privacy laws when it comes to setting up an LLC.

A DE C Corp is a great option to start your business from if you are looking to raise funds from outside investors or prefer having a US corporate structure instead of an LLC in the US. 

Dubai is very crypto friendly and a great place to setup an operational or proprietary trading entity as you can operate within their defined regulations depending on the free-zone that is best suited for your activities.

Defined Regulation 

By acquiring a Crypto licesne from the freezone authority you can be confident you are working within bounds without the fear of rogue regulatory agencies that create their own undefined standards.

Visas 

It is a favourable place to relocate to and allows you to get Visas for key members of the project as well as their dependants. Use our pre-packaged option for yourself and two additonal team members to be setup in Dubai with minimal stress. 

Taxes and Banking

UAE companies can allow you to become a tax resident of Dubai allowing for an effecient tax setup. They also have a low corporate tax rate for activities generating revenue in the UAE.

It is also a jurisdiction that has access to banking, this is especially important now that we see banking getting harder for web 3.0 development companies in other jurisdictions, learn more about these topics in our founder's Substack.

Singapore has traditionally been a great location to register an entity for startups. This has created an enviroment where operational entities and development studios can flourish.

Payments

When running an operational entity in Singapore, it is best to do this fully in crypto as there have been instances where bank accounts get shut down when crypto is being off ramped. Therefore we don't see Singapore as a great location when a bank account is required although we have seen less problems when offraping through a local Singpaore based exchange such as Coinhako.

Work Pass

Another reason why Singapore is a popular jurisdiction for crypto start ups is the Work Pass which can be obtained that can allow you to work and live in Singapore.

Rule of Law

Moreover, Singapore is a popular Asian jurisidction to incorporate in as they operate under common law and their is a strong rule of law in the country that many people are comfortable working under.

Switzerland is best if you are looking for a European based Operational Entity for start ups in a crypto friendly Jurisdiction. Swiss companies have access to fiat banking and you can have the privacy and prestige of having your company setup in the heart of Switzerland's Crypto Valley. 

GmbH vs. AG

The Swiss GmbH can be seen as an equivalant to an LLC. While the AG is equivalant to a corporation. Both work well as an operational entity.

Local Director

In Switzerland it is required to have a local director for your entity. This Director needs to be located in Switzerland itself. Otonomos can provide a local director to have your GmbH registered. Alternatively, you can appoint your own local director if preferred.

Ireland is great if you are looking for a European based Software development or operational entity for start ups in a jurisdiction that is not hostile to crypto. Irish companies have access to multiple fiat banking options and you have the legitimacy of having your company setup in a known international business hub.

Ireland is a unique country in the EU that has common law allowing for a potentially more business friendly environment than other EU nations.    

EEA Director

In Ireland it is required to have a European Economic Area based director for your entity. This Director needs to be a natural person and cannot be a corporate body. Otonomos can provide a local director for your limited company. Alternatively, you can appoint your own local director if preferred or take it in personal name if your are European based. 

Malta is great if you are looking for a European based Software development or operational entity for start ups in a jurisdiction that is not hostile to crypto.

Malta is a unique country in the EU that has a blend of civil and common law allowing for a potentially more business friendly enviroment than other EU nations.    

Natural Director

In Malta it is required to have a Natural person as at least one director for your entity. Otonomos can provide a local director for your limited company, alternatively, you can appoint your own local director if preferred or take it in personal name if you are comfortable doing so.

Great if you are looking for a private vehicle to run your DevCo from. Panama entities are also highly tax optimized. Banking in Panama is very private however to open a fiat bank account you will need to travel and visit the bank in person.  

Director

In Panama it is required to have 3 directors for your entity. This can be a corporate Director which can be one of your entities. Alternatively, Otonomos can provide Corporate Nominee Directors to have your entity registered.

Visa

Panama allows people to fairly easily acquire a Visa to move and live in Panama. This makes Panama a popular jurisdiction to register an Operational Entity in Latin America.

Banking

Moreover, Panama has banking options for crypto businesses in an offshore setting allowing you to bank offshore in an operational entity.