A nonprofit once handed back roughly $500 million and dissolved itself on purpose. Here is what that taught crypto about legal structure, onchain governance and who actually holdsΒ power.
Three structures, three different jobs. Only one of them can sign a contract.
In May 2021, a nonprofit gave away 84,000 governance tokens. At the time they were worth close to $500Β million.
Then it shut itself down. OnΒ purpose.
That nonprofit was the Maker Foundation. The protocol it had been stewarding is known today as Sky Protocol.
And that single decision still frames a question every onchain project eventually has to answer outΒ loud.
Who actually runs thisΒ thing?
There are three answers in circulation. A DAO. A foundation. A company. Most people treat them as competing options.
They are not. They are layers. And the protocols that hold up under pressure tend to use allΒ three.
DAO vs Foundation vs Company: What Actually Separates Them
Short versionΒ first.
A DAO is a decision-making system. Token holders vote, code executes. No registered office, no signature on aΒ lease.
A foundation is a legal entity with no owners. It can hold IP, sign contracts, publish reports and instruct a law firm. It is not supposed to control the protocol.
A company is a legal entity with owners. Fast, familiar, easy to hire through. It also has a boss, which is exactly theΒ problem.
The real dividing line is not ideology. It is far more boring thanΒ that.
Who can a court sue. Who can open an account. Who signs when a vendor asks for a signature.
A DAO, on its own, cannot sign anything. That gap is the entireΒ story.
Signing power, liability shield and control, side by side. The gaps are the reason legal wrappersΒ exist.
Why a Pure DAO Leaves Token Holders LegallyΒ Exposed
Here is the part most βwhat is a DAOβ explainers skip.
If a group acts together for profit without registering an entity, most legal systems already have a default box waiting: general partnership, or unincorporated association.
In a general partnership, members are personally liable for the groupβsΒ debts.
Read that twice if you hold governance tokens and vote withΒ them.
This is why βwe are just a DAO, we have no entityβ stopped being a flex around 2023. Governance is not a shield. Governance without a legal wrapper is exposure.
The Crypto Foundation Structure Is a Legal Wrapper, Not aΒ Boss
Foundations exist to absorb that exposure without becoming a boss. Three shapes dominate.
Cayman foundation company. Ownerless. Run by a small board or council, with token holders named as beneficiaries. Common for large token ecosystems holding IP and contracts.
Wyoming DUNA. A US nonprofit association purpose-built for DAOs, effective July 1, 2024. No mandatory board. Bylaws can point directly at onchain votes. Members are shielded from the associationβs debts.
The catch is honest and worth saying out loud. A foundation fixes the paperwork problem by creating a small group of humans who hold a pen. That is a genuine centralization cost.
Which is why wording matters. The footer of skyeco.com reads:
βThis website is managed by Sky Frontier Foundation (SFF). The SFF is an independent entity and does not have authority over Sky Protocol, its smart contracts, or governance decisions.β
That is a foundation publicly disclaiming control over the thing it supports. Not modesty. Architecture.
The Company Model Buys Speed and Cannot ShedΒ Control
Companies are still everywhere in crypto, for good reason. You can hire. You can sign an engagement letter. You can buy insurance.
What you cannot do is make the control disappear.
Regulators have not drawn a neat line between βthe DAOβ and βthe devΒ shop.β
If your company holds admin keys, your decentralization story is a marketing asset, not a legalΒ defense.
So the pattern that actually emerged is not DAO or foundation or company. ItΒ is:
DAO for authority
Foundation for legalΒ capacity
Independent companies for execution
Three layers, deliberately keptΒ apart.
Authority, legal capacity and execution, kept in separateΒ hands.
How Sky Ecosystem Splits Authority, Publishing and Execution
Sky Ecosystem is a clean worked example, because each layer is named differently onΒ purpose.
Sky Governance holds authority. Staked SKY activates voting power over risk parameters, collateral types, debt ceilings and protocol upgrades. Proposals move through forum review, then onchain voting, then execution. Once executed, a change cannot be reversed directly. It can only be challenged by passing a new proposal.
Sky Frontier Foundation publishes. Reports, disclosures, formal positions. It does not set parameters.
Sky Agents execute. Spark, Grove, Obex, Osero and others are independent capital allocators. They access USDS liquidity under governance-set risk parameters and deploy it. They are not subsidiaries.
The naming discipline is not pedantry. It is the difference between βSky Governance voted to change the rateβ and βthe foundation changed the rate.β Only one of those is true, and only one survives a regulator readingΒ it.
Scale check. Sky Protocol currently shows roughly $14.15B in Total Collateral backing about $11.48B in stablecoin supply.
A coalition of crypto organizations then wrote to the US Treasury asking for federal recognition of the DUNAΒ model.
Second, credit agencies started grading governance. When S&P Global assigned Sky Protocol a B- issuer credit rating, the first ever given to a DeFi protocol, it flagged governance concentration and low voter participation as risk factors. Not code quality. Governance.
That is the real trend. Governance design is now a creditΒ input.
And the numbers deserve honesty. Most DAO proposals draw participation in the 5% to 15%Β range.
An OpenZeppelin governance review found that in 17 of 23 major DAOs, the top 10 delegates held enough voting power to pass a proposal on theirΒ own.
Decentralization on paper is not decentralization in practice.
Decentralization on paper versus decentralization in practice.
So Which Structure Should a Protocol ActuallyΒ Pick?
A rough decisionΒ frame.
Public infrastructure with a global contributor base? Foundation plusΒ DAO.
Distributing revenue to holders? A nonprofit DUNA will not fit. Look at LLC structures.
Pre-launch with a small team shipping fast? A company, plus a credible plan to reduceΒ control.
Already decentralized and worried about member liability? A DUNA or an offshore foundation, and stop delaying.
The one answer that is clearly wrong is doing nothing and hoping the word βdecentralizedβ holds up in court. Ooki settled that argument.
Eight years of protocols answering the same structural question.
The Question Nobody Has a Clean AnswerΒ To
Here is what I keep circling backΒ to.
The Maker Foundation dissolved itself in 2021. Sky Frontier Foundation exists today and openly disclaims authority over the protocol.
Both were the right call at the time, which suggests these structures are not permanent identities at all. They areΒ stages.
So, a question worth arguing aboutΒ below.
If a foundationβs job is to eventually make itself unnecessary, how do you tell the difference between one genuinely winding down its influence and one quietly becoming theΒ boss?
After a final rule upending the RIF process took full effect, performance will now be the top priority, with seniority and tenure serving as tiebreakers.
New Amazon board member Kevin Mandia is a cybersecurity veteran. (Photo via Amazon)
Amazon named cybersecurity veteran Kevin Mandia to its board of directors, adding new security expertise a few months after former NSA director Keith Alexander stepped down.
Mandia founded Mandiant, the breach-investigation firm Google acquired for $5.4 billion in 2022, and remained at the search giant as a strategic advisor through July 2025, according to his LinkedIn profile. He now leads Armadin, an AI security startup he started last year.
Amazon said in its announcement that βcybersecurity is one of the most consequential risks and responsibilities organizations face today, and the threat landscape continues to evolve rapidly alongside advances in AI.β
Amazon added a cybersecurity specialist to its board in 2020, when it elected Alexander, who also led U.S. Cyber Command. Mandia comes from the other side of the field, with two decades spent investigating corporate breaches rather than defending government networks.
His appointment also puts an AI security entrepreneur on the board of a company whose cloud infrastructure underpins much of the internet. Armadin, founded in September 2025, uses AI to run attacks against corporate networks, probing defenses the way an intruder would.
The boardβs Security Committee, which oversees Amazonβs cybersecurity policies and its response to significant cyber incidents, is now chaired by Dan Huttenlocher, dean of the MIT Schwarzman College of Computing. Mandia joins as a member, along with former Bridgewater co-CEO Jon Rubinstein.
Amazon also named Mandia to the boardβs Audit Committee, according to a securities filing.
Mandia received 4,086 restricted stock units in connection with his election to the board, vesting in three equal annual installments beginning Nov. 15, 2027, the filing shows. The shares were worth about $1.03 million at Amazonβs closing price Wednesday.
The filing disclosed that his sister-in-law, Kristin Mandia, is an Amazon employee with an annual salary of $185,000. The company said her compensation is consistent with that of other employees at her level with similar responsibilities.
"Somewhere along the way we've lost the tolerance for federal workers to make a mistake when they're trying to do the best job that they can," said Rob Shriver.