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| 3 minutes read

The Cudos Network Foundation launches in Gibraltar

Congratulations to the Cudos group for launching their Cudos Network Foundation!

The Cudos Network Foundation (Cudos Foundation) is set up in Gibraltar under the Private Foundations Act 2017. A foundation is an entity with separate legal personality which is able to hold and deal with property in its own name, as absolute legal and beneficial owner, for the specific purposes that are detailed in the foundation charter.

The Foundation will serve as a catalyst for development and growth of the Cudos blockchain network (CUDOS Blockchain) in support of becoming the preeminent leader in decentralised cloud computing. The Foundation will serve as both a gateway and a destination, bringing together an ever-growing community of Web3 builders and creators grounded in Cudos’ core principles of sustainability, inclusivity, and impact. The Foundation is a support hub for projects, developers, and community members focused on providing funding, resources, and community initiatives that are vital to the expansion of Cudos’ blockchain ecosystem.

To spur innovation, the Foundation is launching a grant program to support talented creators and projects that provide significant value to the Cudos blockchain network. The grant program is focused on funding the development of the Cudos blockchain infrastructure, end-user applications on-chain, and community expansion endeavours.

The Foundation has appointed Belvedere Trustees Limited, a regulated company affiliated with Hassans International Law Firm Limited, as the professional councillor, as required for all foundations established in Gibraltar. The presence of a regulated entity on the Council of the Foundation provides a robustness and professionalism commonly missing from foundations set up in other jurisdictions, giving all Cudos stakeholders an added layer of comfort and confidence in the running of the Foundation and the Cudos project as a whole.

Commenting on the launch, Matt Hawkins, Founder of the Cudos blockchain network, stated, “As you may be aware, the Cudos blockchain network rolled out its mainnet in June and is poised to work with its extensive list of partners as well as visionary builders to create ambitious decentralised applications that focus on creating a decentralised, sustainable, and connected world. Within this picture, the Foundation is critical for realising our overarching vision of nurturing high-impact projects that align with our values through the grant program.

Aaron Payas, Partner at Hassans and Cudos’ lead counsel in Gibraltar, added, “Cudos continues to grow its presence in Gibraltar benefiting from our crypto-friendly but internationally compliant laws and regulations. The Gibraltar foundation structure is robust whilst retaining enough flexibility to support decentralised protocols such as Cudos. With the crypto foundation, Gibraltar has added yet another string to its bow as it cements its place as a premier jurisdiction for all crypto and web3 projects.

Background on Gibraltar Foundations

With respect to crypto foundations, Gibraltar is clearly now a front-runner. Gibraltar is a crypto-friendly jurisdiction having had a DLT Framework in place since 2018. In addition, Gibraltar scores highly with respect to compliance with OECD and FATF international standards.

With this backdrop, we can look at how Gibraltar foundations can be used as support vehicles for decentralised crypto protocols. With protocols being decentralised, foundations are critical in coordinating the efforts to build, support, grow and improve the protocol. The foundation can be funded in various ways including by way of proceeds from a token sale or via donations from stakeholders. Foundations can distribute funds and make grants with much more flexibility compared to a regular company as that is the whole purpose of the foundation, which is in contrast to a company which operates for the benefit of its shareholders. Furthermore, a foundation may create subsidiary companies if this helps it to further its objects. From a tax perspective, a Gibraltar foundation will likely not have any income that will be assessable for tax as Gibraltar uses a territorial basis for taxation and only taxes income that is derived or accrued from Gibraltar. In addition, there is no VAT or capital gains tax in Gibraltar.

With such structures working well, it is time for Gibraltar to be considered as a very viable option for such foundations and a direct competitor to Switzerland, Singapore and Panama.

Feel free to reach out for further information: 

Twitter: @aaronpayas

"With the crypto foundation, Gibraltar has added yet another string to its bow as it cements its place as a premier jurisdiction for all crypto and web3 projects." - Aaron Payas, CFA

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