The Republic of the Marshall Islands has moved to formally recognize decentralized autonomous organizations, better known as DAOs, as legal entities — a move that gives collectively owned and managed blockchain projects formal recognition on the global stage.

DAOs, which are blockchain-based entities governed by self-organizing communities, have attained legal recognition in the Marshall Islands after the country passed the amended Non-Profit Entities Act 2021. The amendment allowed cryptocurrency trading infrastructure platform Shipyard Software to incorporate the island country’s first DAO, Admiralty LLC. The incorporation was aided by MIDAO Directory Services Inc., a domestic organization that was established to help DAOs register within the Marshall Islands.

As it currently stands, the new legislation allows any DAO to register and establish operations in the Marshall Islands.

Related: AssangeDAO concludes raise with $53M to help Julian fight for freedom

Bobby Muller, the former chief secretary of the Republic of the Marshall Islands and co-founder of MIDAO, said his country recognizes that now is a “unique moment to lead” in the “blockchain revolution.” He said DAOs will play an important role in creating “more efficient and less hierarchical” organizations.

In a written statement to Cointelegraph, Muller said the Marshall Islands is looking to become a global hub for DAOs, “both in registering and domiciling, but also in developing out use cases and furthering mass adoption.” He further explained:

The Marshall Islands is an independent island state located in the Pacific Ocean near the Equator with a population of around 59,000 as of 2019, according to the World Bank. The island state has been actively exploring use