Court Rules Lido DAO As General Partnership Under State Law

According to BlockBeats, a federal court in the Northern District of California has ruled that Lido DAO can be classified as a general partnership under state law. This decision dismisses Lido's claim that it is not a legal entity, setting a precedent for how profit-driven decentralized autonomous organizations (DAOs) are treated legally. The court further determined that identifiable participants in Lido DAO are involved in managing its operations, meaning they cannot evade responsibility through its decentralized structure. Court documents indicate that Paradigm Operations, Andreessen Horowitz, and Dragonfly Digital Management are accused of being general partners due to their alleged active participation in Lido's governance and operations. Miles Jennings, the general counsel and head of decentralization at a16z crypto, expressed concern over the ruling, stating that it deals a significant blow to decentralized governance. He highlighted that, according to the decision, any involvement in a DAO, even something as minor as posting on a forum, could be enough to hold DAO members accountable for the actions of other members under general partnership laws.