Deciphr Academy
Track 6 · Module 26 · Lesson 7 of 7 · 8 min read

What might a Cayman foundation company for a crypto project look like?

Short answer

In our made-up case, Brindlecove Labs plans the Quellmoor Foundation to hold a protocol's treasury and code. Its memorandum must meet section 4 of the Act, it needs a licensed secretary, and it can drop its members if its memorandum allows it and it keeps a supervisor.1,2 BRDL holders steer it through bylaws, which the constitution can provide for.3 It is a teaching example, not advice.

BRDL holdersquorum 40,000,000 BRDL3 directorsact on the votesSupervisoran independent firmSecretarylicensed, in CaymanQuellmoor Foundationno members, no ownersbylawsA made-up example, not advice
Fig. 7. The made-up Quellmoor Foundation. BRDL holders vote under the bylaws, three directors act, one supervisor watches, and a licensed secretary in Cayman keeps the registered office.

The plan in one line

Brindlecove Labs, a made-up company, wants a legal home for its made-up Quellmoor protocol that no single company owns. A foundation company can be ownerless: it may stop having members if its memorandum allows it and it keeps at least one supervisor.2,4

What the memorandum must say

Section 4 of the Act sets the memorandum's must-haves, and section 8 adds one more for a foundation that will have no members. Maya maps each one to her draft.1,2

The Act requires Maya's draft (made up)
A statement that it is a foundation company1 "The Quellmoor Foundation is a foundation company."1
Its objects, which need not benefit other people1 To support and develop the Quellmoor protocol, hold its treasury and code, and fund grants1
What happens to spare assets on a winding-up1 Given to a charity chosen by an ordinary resolution, as in the Act's model5
A ban on dividends to members1 No dividends or payouts of profit to any member1
To run with no members: the memorandum must allow it, and a supervisor must stay2 The memorandum allows it, and the foundation keeps at least one supervisor2

Maya also has to decide whether the foundation should be legally bound to pursue its objects. The Act says it only has that duty if the memorandum expressly says so and names who can enforce it.6

She checks the limits on changes too. The memorandum can only be changed as the memorandum itself allows, and a change that would break the section 4 rules has no effect.7

Who is who

  • Secretary. A licensed Cayman company manager. The Act requires one at all times, and its business address becomes the registered office.8,9
  • Directors. Three, to run the foundation and sign contracts. The constitution can give powers to others, but management sits with the directors.10
  • Supervisor. One independent professional firm. Under the Act, a supervisor is someone other than a member with an unconditional right to attend and vote at general meetings.11 Ogier wrote in 2020 that directors and supervisors don't have to be people, so a firm can fill the role.4
  • Beneficiaries. None with rights. Unless the constitution gives them some, beneficiaries have no rights over the company.6

Without members, the supervisor is the main check on the directors. Ogier describes the role as a steward that makes sure the directors follow the governing documents.12 If the foundation ever had no supervisor, and the constitution couldn't fix that, the Grand Court could appoint one.13

What BRDL holders control

The Act lets the constitution give powers to "others", including the power to appoint and remove directors and supervisors.10 It can also provide for bylaws, which the directors must follow as far as the law and the constitution allow.3 Maya uses both.10,3

The idea of a director check comes from real practice: the Arbitrum Foundation's bylaws let its directors reject a token holder vote that would break the law.14 Walkers also says the directors follow the DAO's instructions "subject to applicable law".15

How to check a BRDL vote

First check the quorum: add every vote that took part, For, Against and Abstain. Then compare the votes for with the votes cast, which are the For and Against votes only. Suppose 30,000,000 BRDL vote for, 15,000,000 against and nobody abstains. That is 45,000,000 votes, so the quorum is met. 30,000,000 is two-thirds of 45,000,000, so even a rights change passes, because the rule says "at least" two-thirds. If another 5,000,000 BRDL had abstained, 50,000,000 would have taken part, but the votes cast would still be 45,000,000 and the result the same. The same method gives the Act's model special resolution.16

Maya's yearly list

Lesson 5 covers each duty. For the Quellmoor Foundation, Maya's list is short.17,18

  • File the economic substance notification, then the annual return, and pay the annual fee for an exempted company with no registered capital: CI$1,025 from January 2027 (it was CI$925 in 2026).18,17,19,20
  • Update the register of supervisors within 60 days of any change.9
  • File any change to the memorandum within 15 days.7
  • Keep beneficial ownership details current through the corporate services provider.21,22
  • Give the secretary what it needs for anti-money laundering checks, and get its notice before accepting any gift of assets.23

Questions before launch

These questions come straight from earlier lessons: the VASP Act, the SEC's 2017 DAO report, CIMA's sanctions rule and Walkers' warning.24,25,26,27 A real project would ask them of Cayman lawyers and of lawyers in each country where it has users.28

Our viewA foundation company is mostly paperwork that holds a promise: the community decides, the directors act, the supervisor checks. Getting that paperwork right, and keeping it current, is what makes the promise real.
Sources
  1. Foundation Companies Act (2025 Revision): section 4 (foundation company requirements). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  2. Foundation Companies Act (2025 Revision): section 8 (members and supervisors). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  3. Foundation Companies Act (2025 Revision): sections 11 and 12 (dispute resolution, bylaws). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  4. The Foundation Company as a Decentralised Autonomous Organisation (DAO) in the Cayman Islands. Ogier (law firm briefing), 31 March 2020.
  5. Foundation Companies Act (2025 Revision): Schedule 2, model memorandum of association. Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  6. Foundation Companies Act (2025 Revision): section 7(4)(d) to 7(5) (enforcement, beneficiaries, duty to carry out objects). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  7. Foundation Companies Act (2025 Revision): sections 9 and 10 (altering the memorandum and articles). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  8. Foundation Companies Act (2025 Revision): section 16 (secretary). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  9. Foundation Companies Act (2025 Revision): sections 13 and 14 (registered office, register of supervisors). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  10. Foundation Companies Act (2025 Revision): section 7(1) to 7(4)(c) (duties, powers and rights). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  11. Foundation Companies Act (2025 Revision): section 2 (definitions). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  12. Supporting Decentralised Autonomous Organisations in Cayman. Ogier (law firm briefing), 8 August 2024.
  13. Foundation Companies Act (2025 Revision): section 19 (breakdown in the appointment of directors or supervisors). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  14. The Arbitrum Foundation Amended & Restated Bylaws. The Arbitrum Foundation, adopted 20 July 2023.
  15. Cayman Islands Foundation Companies: The leading vehicle for wrapping a DAO (how wrapping works, and the Lido DAO ruling). Walkers (law firm briefing), 29 November 2024.
  16. Foundation Companies Act (2025 Revision): Schedule 2, model articles of association. Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  17. Companies Act (2026 Revision): sections 168 and 169(3) (annual return; late penalties). Cayman Islands Government, Legislation Gazette, revised as at 1 January 2026.
  18. DITC Economic Substance Notification (User Guide) - CAP. Cayman Islands Department for International Tax Cooperation, June 2024.
  19. Companies Act (2026 Revision): section 169(1) and (2), and Schedule 5, Part 4 (annual fees of exempted companies, 2026 figures). Cayman Islands Government, Legislation Gazette, revised as at 1 January 2026.
  20. Companies (Amendment of Schedule 5) (No. 2) Order, 2026 (SL 46 of 2026): annual fees of exempted companies from 1 January 2027. Cayman Islands Cabinet, Legislation Gazette No. 48, made 14 October 2026, published 16 October 2026.
  21. Beneficial Ownership Transparency Act (2026 Revision). Cayman Islands Government, Legislation Gazette (copy hosted by the Cayman Islands Monetary Authority), revised as at 14 January 2026, published 29 January 2026.
  22. Cayman Islands Foundation Companies (pages 7 to 12: filings, beneficial ownership, economic substance, tax). Conyers (law firm guide), uploaded August 2025.
  23. Foundation Companies Act (2025 Revision): section 17 (compliance with certain laws). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2024.
  24. Virtual Asset (Service Providers) Act (2024 Revision, since amended in 2024 and 2025): section 2 (definitions). Cayman Islands Government, Legislation Gazette, revised as at 31 December 2023, published 15 February 2024.
  25. SEC Issues Investigative Report Concluding DAO Tokens, a Digital Asset, Were Securities. US Securities and Exchange Commission, press release 2017-131, 25 July 2017.
  26. Rule: Compliance with Financial Sanctions and Targeted Financial Sanctions. Cayman Islands Monetary Authority, July 2026.
  27. Cayman Islands Foundation Companies: The leading vehicle for wrapping a DAO. Walkers (law firm briefing), 29 November 2024.
  28. Cayman Islands Foundation Companies (preface and pages 4 to 5). Conyers (law firm guide), uploaded August 2025.
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General education built from the publicly available sources listed above. Not financial, legal, tax or investment advice. Naming a company, project or regulator is not an endorsement either way. Last checked 2026-10-22. Terms and disclaimer.