ADGM DLT Foundations: A Legal Framework for Web3, DAOs and Blockchain Projects
Blockchain projects do not always fit comfortably within conventional corporate structures. Traditional companies are generally organised around shareholders, ownership interests and centralised management, while Web3 ecosystems may rely on tokenholders, community voting, smart contracts and protocol-based decision-making.
The Abu Dhabi Global Market introduced the Distributed Ledger Technology Foundations Regulations in 2023 to provide a purpose-built legal structure for blockchain foundations, decentralised autonomous organisations, commonly known as DAOs, and other token-based ecosystems. The framework allows a DLT Foundation to obtain separate legal personality and establish governance arrangements involving founders, foundation councils and tokenholders.
A DLT Foundation can provide the legal architecture required to hold and administer assets, enter into agreements, manage intellectual property and define how governance rights interact with a project’s technological infrastructure. However, registration as a DLT Foundation does not automatically authorise the provision of regulated financial services. Activities falling within ADGM’s financial services framework may require separate permission from the Financial Services Regulatory Authority.
The regime was further updated through amendments published by the ADGM Registration Authority in May 2026, reinforcing the importance of reviewing the current legal, beneficial ownership and compliance requirements before establishing the structure.
This guide explains what an ADGM DLT Foundation is, how its governance framework operates, how tokenholder rights may be structured, which projects may benefit from it and which regulatory considerations should be assessed before registration.
What Is an ADGM DLT Foundation?
An ADGM DLT Foundation is an ownerless legal entity established under the Distributed Ledger Technology Foundations Regulations. It has its own legal personality, meaning that it can hold assets, enter into contracts, assume obligations and participate in legal proceedings independently from its founder, councillors and tokenholders.
Unlike a conventional company, a DLT Foundation does not have shareholders or share capital. Its assets are administered in accordance with the objectives and governance arrangements established in its constitutional documents. This separation allows a blockchain project to place protocol assets, intellectual property, treasury funds or other resources within a recognised legal structure without transferring ownership to shareholders.
The structure is specifically designed for blockchain foundations, decentralised autonomous organisations and Web3 ecosystems. It can accommodate token voting, smart contract-enabled processes and decentralised governance arrangements that may not fit easily within a traditional corporate model. A DLT Foundation may also establish subsidiaries within ADGM or in other jurisdictions when the project requires additional operating entities.
A DLT Foundation should also be distinguished from a standard ADGM foundation. Standard foundations are frequently used for wealth management, succession planning and asset protection, while the DLT Foundation framework addresses the particular legal and governance requirements of distributed ledger technology, token issuance and community-led projects.
Why Traditional Company Structures May Not Fit Web3 Projects
Conventional companies are built around identifiable owners, share capital, directors and voting rights connected to shareholdings. This model works well for businesses with centralised ownership and management, but it may create structural difficulties for blockchain protocols and decentralised communities.
A Web3 project may need to distribute decision-making among tokenholders, execute approved actions through smart contracts, manage a decentralised treasury and continue operating independently from its original developers. Attempting to place these arrangements within an ordinary shareholder structure can create uncertainty over ownership, authority and responsibility.
Conventional Company | ADGM DLT Foundation |
Owned by shareholders | Ownerless legal structure |
Voting rights generally follow share ownership | Governance rights may be allocated to tokenholders |
Managed through a board of directors | Governed through a Foundation Council and the project’s constitutional framework |
Corporate assets are held for the company’s business activities | Assets are administered according to the Foundation’s defined objectives |
Governance is primarily documented through corporate resolutions | Governance may incorporate token voting and smart contract-enabled processes |
Ownership may change through share transfers | The structure can continue independently from its original founders |
The DLT Foundation framework connects an independent legal entity with decentralised governance mechanisms. It therefore allows a project to preserve community participation while providing a recognised party that can hold assets, enter into agreements and interact with regulators, banks, service providers and other institutions.
The structure does not remove the need for accountable governance. Instead, it requires the project to translate its technological and community-based decision-making processes into a legally coherent framework.
Key Participants in an ADGM DLT Foundation
The governance of a DLT Foundation is not limited to a traditional board structure. Its Charter must identify the bodies involved in the organisational and governance framework, define their respective powers and explain how decisions are proposed, approved and implemented.
Participant | Principal Role |
Founder | Establishes the Foundation, defines its initial objectives, contributes the initial assets and approves the original Charter. Certain powers may be reserved to the Founder until those rights expire or the Founder resigns. |
Foundation Council | Manages the Foundation and ensures that its activities remain consistent with its objectives and constitutional framework. Every DLT Foundation must have between two and sixteen councillors. |
Tokenholders | Hold tokens issued or recognised by the Foundation. Their voting, information and economic rights must be defined in the Charter, together with the matters on which they may participate in decisions. |
Guardian | May be appointed to provide an additional layer of oversight and monitor whether the Foundation Council is acting in accordance with the Charter and the Foundation’s objectives. |
Beneficiaries | May receive benefits or distributions from the Foundation where the structure provides for beneficiaries. The Charter must clarify whether tokenholders are also treated as beneficiaries. |
Company Service Provider | Provides the registered office and supports the Foundation with incorporation, statutory filings and ongoing administration where an ADGM-licensed provider is required. |
If the Foundation issues tokens, it must have tokenholders, and the Charter must specify whether those tokenholders are treated as beneficiaries. The framework also allows additional governance bodies to be created where required by the project. These may include technical committees, treasury committees, grant committees or community governance bodies. Their authority, appointment procedures and relationship with the Foundation Council must be clearly documented.
This flexibility allows the legal structure to reflect the project’s actual governance model. It also prevents uncertainty over whether an on-chain vote is advisory, binding or subject to further approval by the Foundation Council.
The Charter, DLT Framework and Supporting Documents
The Charter is the principal constitutional document of an ADGM DLT Foundation. It establishes the legal rules governing the structure and must identify the Foundation’s name, founder, objectives, initial assets, Foundation Council and any additional bodies forming part of its organisational and governance framework. The Charter should also define:
How councillors and other governance participants are appointed and removed
Which decisions remain reserved to the Foundation Council
Which matters may be delegated to tokenholders or other governance bodies
How proposals are submitted, voted upon and approved
The voting thresholds and quorum requirements that apply
Whether tokenholders are treated as beneficiaries
How income, assets or other benefits may be distributed
How conflicts of interest, emergency decisions and governance failures are managed
The framework does not require a DLT Foundation to operate through traditional corporate by-laws. This provides greater flexibility, but it also makes the drafting of the Charter particularly important because the project’s governance arrangements must be sufficiently clear to operate in practice.
Where applicable, the legal structure must also be supported by a White Paper, Tokenomics Paper, smart contracts and a DLT Framework. The DLT Framework describes how the underlying technology is governed and how technological risks are assessed, monitored and controlled. It may address areas such as coding controls, testing procedures, production monitoring, security arrangements and post-deployment support.
These documents should operate as one coherent system. The Charter may define the legal authority of tokenholders, while the Tokenomics Paper explains the function and distribution of the tokens, the White Paper describes the broader project and the smart contracts execute specific processes on-chain. If these elements conflict, the project may face uncertainty over which decision is legally effective. The legal documents, governance procedures and technological architecture should therefore be reviewed together rather than developed as separate workstreams.
Token Issuance and Tokenholder Rights
An ADGM DLT Foundation may issue tokens or support a project that already has an established token ecosystem. If tokens are issued, the Charter must identify the relevant categories of tokenholders and explain the legal, governance and economic rights attached to each category. The documentation should address matters such as:
The purpose and function of the token
The total supply and issuance mechanism
Allocation and vesting arrangements
Voting and information rights
Transfer restrictions or eligibility conditions
Treasury allocations and grant programmes
Distribution, redemption or buyback arrangements
The circumstances in which tokens may be suspended, replaced or cancelled
Tokenholders may be granted voting rights over delegated matters. These can include decisions concerning the project’s governance, technical development, treasury use or other matters identified in the Charter. Certain fundamental decisions may require a qualified tokenholder resolution unless the Charter expressly establishes a different arrangement.
Tokenholder governance is not unlimited. The Foundation Council retains responsibility for legal and regulatory compliance and may be required to prevent the implementation of a decision that would breach the law, conflict with the Charter or White Paper, or expose the DLT Framework to a harmful security event.
Registration as a DLT Foundation does not determine the regulatory classification of a token. The rights, functionality and manner in which the token is issued, offered, traded or redeemed may bring it within a separate financial services or digital asset framework. Tokens that function as securities, fiat-referenced tokens or other regulated instruments may therefore require additional approvals or an appropriately authorised operating entity.
A regulatory assessment should be completed before token issuance, rather than after the token model and public documentation have already been finalised.
Which Projects May Use an ADGM DLT Foundation?
A DLT Foundation may be suitable where a blockchain or Web3 project requires an independent legal entity to support protocol development, community governance, treasury administration or token-based participation.
Potential use cases include:
Layer 1 and Layer 2 blockchain ecosystems
Decentralised autonomous organisations
Open-source blockchain protocols
Decentralised application ecosystems
Token-based community governance structures
Protocol treasury and grant programmes
Intellectual property and software stewardship
Developer funding and ecosystem incentive programmes
Gaming, metaverse and digital ownership projects
Blockchain research and industry development initiatives
Existing overseas blockchain foundations seeking to migrate or establish a recognised presence in ADGM
The structure may be particularly useful where the project requires a legal entity to sign contracts, hold intellectual property, administer treasury assets, engage developers, issue grants or interact with exchanges and institutional counterparties while retaining a decentralised governance model.
A DLT Foundation is not necessarily suitable for every technology business. ADGM describes these foundations as generally non-commercial structures focused on the use, deployment, development, facilitation or support of distributed ledger technology and the issuance of utility tokens. They are restricted from conducting activities that require Financial Services Permission unless the appropriate regulatory structure and authorisation are in place.
Projects whose principal purpose is ordinary commercial trading, investment management, custody, operating a virtual asset exchange or providing other regulated financial services may require a company, a separately authorised entity or a group structure incorporating both a DLT Foundation and one or more operating subsidiaries.
The decision should therefore be based on the project’s functions, governance model, token characteristics and regulatory exposure rather than on the appeal of the DLT Foundation label alone.
Principal Registration Requirements
An application to establish an ADGM DLT Foundation requires more than standard incorporation documents. The Registration Authority reviews the proposed governance model, technological framework, token arrangements, financial resources and individuals or entities involved in the structure. The principal requirements include:
Requirement | Summary |
Founder | At least one founder must be appointed. The founder may be an individual or a legal entity. |
Foundation Council | Between two and sixteen councillors must be appointed. Councillors may be individuals or legal entities. |
Initial assets | The Foundation must have initial assets with a minimum value of USD 50,000. The initial contribution must be made in fiat currency rather than tokens or other assets. |
Foundation Charter | A signed Charter must define the Foundation’s objectives, assets, governance bodies, decision-making procedures and tokenholder arrangements. |
White Paper | A White Paper describing the project, its purpose and its operational model must be submitted with evidence of compliance. |
Tokenomics Paper | Required when the Foundation issues or intends to issue tokens. If no tokens are planned, a formal declaration must be provided. |
DLT Framework | Where developed, a publicly accessible link must be submitted together with appropriate security and compliance evidence. |
Company Service Provider | An ADGM-licensed Company Service Provider must generally be appointed unless the Foundation qualifies for an exemption accepted by the Registrar. |
Registered office | The Foundation must maintain an ADGM registered office, which is commonly provided through the appointed Company Service Provider. |
Auditor | An ADGM-registered auditor must be appointed. |
Authorised signatory | At least one individual must be appointed as an authorised signatory, subject to the applicable identification and UAE connection requirements. |
Beneficial ownership information | Details of founders, councillors, beneficiaries, guardians, controllers and ultimate beneficial owners must be disclosed as applicable. |
Regulatory declaration | The application must confirm that the proposed activities do not require Financial Services Permission or that the required approval will be obtained separately. |
The minimum initial asset requirement is currently USD 50,000. ADGM’s registration checklist also requires evidence that the funds are available and confirms that the contribution must be made in fiat currency.
The application may also require identity documents, corporate records, source-of-wealth information, appointment resolutions, compliance reports and details of the project’s data protection contact.
Although the framework does not impose a general physical presence requirement for the project’s international operations, the Foundation must still satisfy its registered office, statutory administration and regulatory filing obligations in ADGM.
How to Register an ADGM DLT Foundation
The registration process should begin with the project’s legal, governance and regulatory design rather than with the online application itself. The documents submitted to ADGM must accurately reflect how the project will operate after registration.
1. Assess the project and regulatory perimeter
The proposed activities, token model, governance structure and sources of revenue should be reviewed to determine whether the DLT Foundation is the appropriate vehicle. This assessment should also identify whether any activity requires approval from the Financial Services Regulatory Authority or another UAE regulator.
2. Appoint an ADGM-licensed Company Service Provider
A Company Service Provider is generally required to coordinate the registration, provide the registered office and submit the application to the ADGM Registration Authority. An exemption may be available in limited circumstances where the applicant demonstrates sufficient UAE resources, personnel, experience and governance arrangements.
3. Design the governance structure
The founder, councillors, authorised signatories and any guardian, beneficiaries or additional governance bodies must be identified. Their powers, responsibilities, appointment procedures and decision-making authority should be established before the Charter is finalised.
4. Prepare the project documentation
The application package may include:
The DLT Foundation Charter
The White Paper
The Tokenomics Paper, where tokens are issued or planned
The DLT Framework, where developed
Smart contract and security information
Compliance reports and legal opinions
Founder and council resolutions
Evidence of the initial assets
Regulatory declarations
The White Paper, Tokenomics Paper, Charter and technical framework should be consistent with one another.
5. Complete due diligence and compliance documentation
Identification, address and corporate documents must be collected for the relevant founders, councillors, authorised signatories, beneficiaries, guardians and ultimate beneficial owners. Source-of-wealth or source-of-funds evidence may also be requested depending on the risk assessment.
6. Appoint an auditor and confirm the registered office
An ADGM-registered auditor must be appointed, and the Foundation must have a registered office in ADGM. The Company Service Provider commonly supplies the registered office as part of its administrative services.
7. Submit the application and respond to regulatory queries
The application is submitted to the Registration Authority together with the required supporting documents and fees. The Registrar may request explanations, revised documents or further evidence concerning governance, token arrangements, technological controls, beneficial ownership or the proposed activities.
8. Complete registration and operational implementation
Once approved, the DLT Foundation receives its registration and commercial licence. The governance bodies, treasury controls, reporting procedures, smart contract processes and record-keeping arrangements should then be implemented in accordance with the approved documents.
The duration of the registration process depends on the complexity of the project, the completeness of the application and whether additional regulatory analysis or approval is required.
ADGM DLT Foundation Costs
According to ADGM’s published Registration Authority fee schedule, the official fee for establishing a DLT Foundation is USD 15,000. The annual renewal fee is USD 14,500.
Official ADGM Registration Fees
Fee Component | Initial Registration |
Name reservation | USD 200 |
Application for incorporation | USD 300 |
Commercial licence | USD 200 |
DLT Foundation business activity | USD 14,000 |
Data protection registration | USD 300 |
Total | USD 15,000 |
Official Annual Renewal Fees
Fee Component | Annual Renewal |
Commercial licence renewal | USD 200 |
DLT Foundation business activity | USD 14,000 |
Data protection renewal | USD 300 |
Total | USD 14,500 |
The required initial asset contribution of USD 50,000 is separate from the registration fees. It becomes an asset of the DLT Foundation and is not an administrative charge paid to ADGM.
The total establishment budget should also account for additional costs, which may include:
Company Service Provider and registered office fees
Charter drafting and legal opinions
White Paper and Tokenomics Paper preparation or review
Technology and security assessments
Smart contract audits
DLT Framework compliance reports
Auditor appointment and annual audit fees
Accounting, bookkeeping and regulatory filing support
Beneficial ownership and due diligence documentation
Financial Services Regulatory Authority applications, where required
Banking, custody and treasury administration arrangements
The professional and technical costs can vary significantly depending on the complexity of the protocol, the number of token categories, the governance model and whether regulated activities are involved.
ADGM fees and administrative requirements may be amended. The applicable schedule should therefore be confirmed with the Registration Authority or appointed Company Service Provider before the application is submitted.
Ongoing Compliance Obligations
Registration is only the beginning of the DLT Foundation’s compliance responsibilities. Its legal documents, governance arrangements, financial records and technological systems must continue to reflect how the project operates in practice.
Accounting Records and Annual Audit
A DLT Foundation must maintain adequate accounting records and prepare annual financial statements. Its annual accounts must be audited by an ADGM-registered auditor, and no general audit exemption is available based on the Foundation’s size or dormant status.
The councillors must file the annual accounts and auditor’s report with the Registration Authority. The standard filing period is nine months after the end of the relevant accounting reference period. The audited accounts must also be published on the Foundation’s website.
Licence and Annual Filings
The Foundation must renew its commercial licence and data protection registration, maintain its registered office and complete the required annual filings. Its Company Service Provider, where appointed, should remain properly licensed and in good standing.
Governance Records
The Foundation should maintain complete records of:
Foundation Council meetings and resolutions
Tokenholder proposals and voting results
Treasury decisions and asset movements
Conflicts of interest
Grants and distributions
Appointments and resignations
Smart contract approvals and amendments
Security incidents and remedial actions
These records help demonstrate that decisions were made through the procedures established in the Charter.
Notification of Material Changes
Changes to the Charter, White Paper, Tokenomics Paper, DLT Framework, smart contracts or other relevant disclosures may need to be notified to the Registrar. Certain updates must be filed within 14 days after taking effect.
Changes to councillors, founders, guardians, authorised signatories, beneficiaries, beneficial owners, the registered office or the Company Service Provider may also trigger filing obligations.
Technology and Security Controls
The Foundation should maintain appropriate governance over its DLT Framework, smart contracts, treasury wallets, access controls and cybersecurity arrangements. Periodic security audits may be required under the applicable documents or regulatory framework.
AML, Sanctions and Beneficial Ownership
Applicable anti-money laundering, sanctions, due diligence and beneficial ownership requirements must be observed throughout the Foundation’s operations. This may involve reviewing contributors, counterparties, token-related transactions, treasury movements and the source of project funds.
Continuing Regulatory Assessment
A project that initially operates outside the financial services regulatory perimeter may later introduce activities requiring authorisation. New token features, custody arrangements, exchange services, staking products, lending functions or fiat-referenced mechanisms should therefore be assessed before they are launched.
Ongoing compliance should be integrated into the project’s operating model rather than treated as an annual administrative exercise.
Key Advantages of an ADGM DLT Foundation
Independent Legal Personality
The DLT Foundation exists as a separate legal entity. It can hold assets, own intellectual property, enter into agreements and participate in legal proceedings independently from its founders, councillors and tokenholders.
Alignment With Decentralised Governance
The framework recognises tokenholders, delegated decision-making and governance processes supported by smart contracts. This allows community participation to be incorporated into the legal structure rather than remaining entirely outside it.
Ownerless Structure
Because the Foundation does not have shareholders, it can support a protocol or ecosystem without placing legal ownership in the hands of equity investors. This may be useful where the project is intended to operate for the benefit of a network, community or defined technological purpose.
Governance Flexibility
The Charter can establish different governance bodies, decision-making thresholds, tokenholder categories and reserved or delegated matters. The structure can therefore be adapted to the project’s technical and operational requirements while preserving identifiable legal accountability.
Asset and Treasury Administration
Protocol assets, treasury funds, intellectual property and grant budgets can be held and administered through the Foundation. This creates a defined legal framework for controlling wallets, approving expenditure and entering into arrangements with developers, service providers and counterparties.
Recognised Legal Environment
ADGM operates as an international financial centre with an independent legal framework based on English common law principles. This can provide greater legal familiarity for international participants, institutional counterparties and professional service providers.
International Operating Flexibility
ADGM states that the framework does not impose a general physical presence requirement on DLT Foundations. The Foundation may also establish subsidiaries within ADGM or in other jurisdictions where separate operating entities are required.
Greater Institutional Credibility
A properly structured and maintained DLT Foundation can provide greater transparency than an informal DAO or unincorporated project. Registration alone, however, does not guarantee banking access, regulatory approval or commercial acceptance. These matters remain subject to independent due diligence and the project’s risk profile.
Important Limitations and Risks
An ADGM DLT Foundation can provide a strong legal framework for a blockchain project, but it does not remove the commercial, regulatory or technological risks associated with Web3 activities.
It Is Not a Financial Services Licence
Registering a DLT Foundation does not authorise the structure to conduct regulated financial services. Activities involving custody, exchanges, investment products, digital securities, fiat-referenced tokens or other regulated services may require separate Financial Services Permission.
The Foundation Is Not Fully Autonomous
Tokenholder voting and smart contracts can form part of the governance model, but the Foundation must still have a Council. Councillors remain responsible for legal compliance and cannot implement decisions that breach the law, the Charter or the Foundation’s objectives.
Establishment and Maintenance Costs Are Significant
The structure requires official registration and annual renewal fees, a minimum initial asset contribution, a Company Service Provider in most cases, an ADGM-registered auditor and potentially extensive legal, technical and security work.
Governance Documents Can Be Complex
The Charter, White Paper, Tokenomics Paper, smart contracts and DLT Framework must be consistent. Poorly defined voting rights, treasury controls or amendment procedures can create disputes or prevent the Foundation from acting when urgent decisions are required.
Audited Accounts Are Mandatory
DLT Foundations do not benefit from a general audit exemption. Annual accounts must be audited, filed with the Registration Authority and published on the Foundation’s website.
Banking and Custody Remain Subject to Due Diligence
Registration does not guarantee access to banking, payment or custody services. Financial institutions may apply enhanced scrutiny to token models, treasury wallets, beneficial ownership, transaction flows and the source of project funds.
Cross-Border Obligations May Apply
Tokenholders, contributors, developers and users may be located in multiple jurisdictions. Securities laws, consumer protection rules, tax obligations, marketing restrictions and data protection requirements outside ADGM may therefore affect the project.
Technology Risks Continue After Registration
Smart contract vulnerabilities, private key compromises, governance attacks, protocol failures and inaccurate oracle data can create legal and financial consequences. Technical controls and security audits must be maintained throughout the project’s lifecycle.
The DLT Foundation should therefore be treated as one component of the project’s broader legal and operating architecture, rather than as a complete solution to every Web3 risk.
ADGM DLT Foundation vs Company vs Standard Foundation
The appropriate structure depends on what the entity is expected to own, how it will be governed and whether it will conduct commercial or regulated activities.
Feature | ADGM DLT Foundation | ADGM Company | Standard ADGM Foundation |
Ownership | Ownerless structure | Owned by shareholders or members | Ownerless structure |
Primary purpose | Blockchain, DLT, DAO governance and token-based ecosystems | Conducting commercial or professional activities | Wealth structuring, succession planning and asset protection |
Governance | Foundation Council, tokenholders and other bodies defined in the Charter | Directors and shareholders | Foundation Council, founder, beneficiaries and guardian where applicable |
Tokenholder recognition | Specifically accommodated | Not built into the ordinary corporate framework | Not a central feature of the standard regime |
Constitutional documents | Charter, with no traditional by-laws | Articles of association | Charter and by-laws |
Assets | Held in the Foundation’s own name for its stated objectives | Held for the company’s business activities | Held in the Foundation’s own name for its objectives and beneficiaries |
Initial contribution | Minimum initial assets of USD 50,000 | Depends on the company type and activity | Subject to the requirements of the standard foundation framework |
Commercial operations | Generally focused on non-commercial DLT purposes | Designed to conduct licensed business activities | Generally used to hold and administer assets rather than operate a trading business |
Financial services | Separate FSRA authorisation may be required | Separate FSRA authorisation may be required | Separate FSRA authorisation may be required |
Annual audit | Mandatory | Depends on the company type, size and applicable exemptions | Depends on the applicable foundation requirements |
Suitable for | Protocols, DAOs, ecosystem treasuries, token governance and blockchain foundations | Technology companies, service providers, exchanges and operating businesses | Family wealth, succession, private assets and long-term ownership structures |
A project may require more than one entity. For example, a DLT Foundation may oversee protocol governance, intellectual property and ecosystem assets, while a separately licensed company conducts commercial operations or provides regulated services.
The structure should reflect the actual division of responsibilities between governance, asset ownership, technology development and revenue-generating activities.
Key Questions Before Establishing a DLT Foundation
Before beginning the registration process, the project should be able to answer the following questions clearly:
What specific role will the DLT Foundation perform within the wider project?
Which assets, intellectual property rights and treasury wallets will be held by the Foundation?
Will the Foundation issue tokens, or will it support tokens issued through another entity?
What legal, governance, economic or information rights will the tokens provide?
Which decisions will remain with the Foundation Council, and which will be delegated to tokenholders or other governance bodies?
How will on-chain voting results be verified, recorded and implemented through the legal structure?
What happens if a tokenholder decision conflicts with the law, the Charter or the Foundation’s objectives?
Will the project conduct any activity that may require Financial Services Permission or approval from another regulator?
Which individuals or entities will act as founders, councillors, authorised signatories, guardians and beneficiaries?
How will treasury access, private keys, multisignature wallets and emergency controls be managed?
Are the White Paper, Tokenomics Paper, smart contracts and DLT Framework consistent with the Charter?
Which entity will employ developers, enter into commercial contracts and receive operating revenue?
How will accounting, auditing, tax, beneficial ownership and regulatory filing obligations be managed?
Which laws may apply in the countries where tokenholders, developers, users or service providers are located?
What procedures will apply if the project changes its token model, governance framework or principal activities?
Resolving these issues before preparing the application can reduce the risk of inconsistent documents, regulatory delays and governance arrangements that cannot be implemented in practice.
Frequently Asked Questions About ADGM DLT Foundations
Is an ADGM DLT Foundation a separate legal entity?
Yes. A registered DLT Foundation has its own legal personality and can hold assets, enter into contracts and participate in legal proceedings in its own name.
Does a DLT Foundation have shareholders?
No. It is an ownerless structure without shareholders or share capital. Its assets are administered in accordance with the objectives and governance rules established in its Charter.
Can a DLT Foundation issue tokens?
Yes. The framework accommodates token issuance and token-based governance. The Foundation must disclose the relevant token arrangements and provide a Tokenomics Paper where tokens are issued or planned. The token and its associated activities must also be assessed under the applicable financial services and digital asset regulations.
Can a DAO use a DLT Foundation as its legal structure?
Yes. The regime is designed to accommodate DAOs and decentralised governance models. However, the Foundation must still have a Council, and its on-chain governance must operate within the legal framework established by the Charter.
What is the minimum initial asset requirement?
The Foundation must have initial assets valued at no less than USD 50,000. The initial contribution must be provided in fiat currency and is separate from the official registration fees.
Is a physical office required in ADGM?
The framework does not impose a general physical operating presence requirement. However, the Foundation must maintain a registered office in ADGM and will generally appoint an ADGM-licensed Company Service Provider.
Does registration include permission to conduct regulated financial services?
No. Registration as a DLT Foundation does not provide Financial Services Permission. Regulated activities require separate assessment and authorisation from the Financial Services Regulatory Authority.
Is an annual audit required?
Yes. The annual accounts must be audited by an ADGM-registered auditor. DLT Foundations do not have a general audit exemption based on size or dormant status.
Can an existing overseas foundation move to ADGM?
The framework allows an eligible overseas foundation to apply for continuation or registration in ADGM, subject to the applicable legal, documentary and regulatory requirements.
Can a DLT Foundation establish subsidiaries?
Yes. A DLT Foundation may establish subsidiaries within ADGM or in other jurisdictions. This can be useful where commercial or regulated operations need to be separated from protocol governance and treasury administration.
How long does registration take?
There is no single timeframe for every application. The process depends on the complexity of the project, the quality and consistency of the documents, the token model, the governance framework and whether any additional regulatory review is required.
How NUR Advisors Group Can Help
Establishing an ADGM DLT Foundation requires coordination across corporate structuring, legal documentation, regulatory analysis, technology, audit and ongoing administration. The structure should be designed around the project’s actual governance and operating model before the registration application is prepared.
NUR Advisors Group can support the establishment process through:
Preliminary assessment of the proposed structure and project requirements
Coordination with an ADGM-licensed Company Service Provider
Preparation of the registration roadmap and document checklist
Collection and review of founder, councillor, signatory and beneficial ownership documents
Coordination with specialist legal counsel for the Charter, legal opinions and regulatory analysis
Coordination with technical and security specialists for the DLT Framework and smart contract assessments
Assistance with auditor, accounting and registered office arrangements
Establishment of related operating companies or subsidiaries where required
Licence renewal, statutory filing and ongoing corporate administration support
UAE residency and government procedures for relevant project representatives
Our role is to bring the different workstreams together so that the corporate structure, governance documents, application materials and operational arrangements remain aligned throughout the establishment process.
Contact NUR Advisors Group to discuss whether an ADGM DLT Foundation is appropriate for a blockchain, DAO or Web3 project and to develop a coordinated establishment plan.
Disclaimer
The information contained in this article is provided by NUR Advisors Group for general informational purposes only. It does not constitute legal, tax, accounting, financial, immigration, employment or other professional advice and should not be relied upon as a substitute for advice tailored to your specific circumstances.
Although reasonable efforts are made to ensure that the information is accurate at the date of publication, laws, regulations, procedures, fees and government requirements may change without notice. NUR Advisors Group makes no representation or warranty regarding the completeness, accuracy or continued validity of the information and, to the fullest extent permitted by law, accepts no liability for any action taken or decision made in reliance upon it.
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