E56: Constitution DAO, Rittenhouse trial coverage, private sector efficiency vs the government

Evidence since 2021 clearly shows non‑US jurisdictions have taken the lead in formal legal structures and regulatory clarity for DAOs and related crypto entities, but the United States has remained a dominant source of capital and development talent for the broader crypto/DAO ecosystem. Because there is no agreed quantitative benchmark for “being left behind” in DAOs, and different dimensions point in opposite directions, the prediction cannot be judged definitively.

Evidence that ex‑US jurisdictions lead in DAO structures/adoption

• Switzerland / Crypto Valley as a DAO and foundation hub. Zug’s “Crypto Valley” has become one of the world’s largest crypto hubs, hosting over 1,200 blockchain/crypto companies by 2024, including the foundations of major protocols such as Ethereum, Cardano, Solana and Polkadot, which are all legally based there rather than in the U.S.(en.wikipedia.org) Zug is frequently described as a global capital for DAOs and Web3 foundations.
• DAO‑friendly offshore jurisdictions. Legal‑structuring guides and law‑firm analyses note that many DAOs choose Swiss foundations, Cayman foundation companies, Liechtenstein foundations, and other offshore entities as their primary wrappers, explicitly because these jurisdictions are more accommodating for decentralized governance.(encrypthos.com) These jurisdictions are repeatedly described as among the most common or well‑used homes for DAOs.
• Marshall Islands DAO Act and large DAO count. The Republic of the Marshall Islands passed a dedicated Decentralized Autonomous Organizations Act of 2022, legally recognizing DAOs as LLCs, explicitly designed to attract DAOs globally.(globenewswire.com) The government’s partner MIDAO reports that by late 2024 it had incorporated or was incorporating over 200 DAO LLCs under this framework and actively markets the country as a leading jurisdiction for Web3 and DAO incorporation.(docs.midao.org)
• EU and other regions providing earlier comprehensive crypto regulation. The EU’s MiCA regulation, adopted in 2023 and fully applicable from December 2024, is widely characterized as the first comprehensive legal framework for crypto‑assets, providing clearer conditions for tokens and service providers that DAOs rely on.(en.wikipedia.org) In Asia and the Middle East, jurisdictions like Singapore, Hong Kong and the UAE have built explicit digital‑asset licensing regimes and branded themselves as crypto and Web3 hubs, attracting exchanges and infrastructure providers that DAOs depend on.(cnbc.com)
• Analyses explicitly stating U.S. federal treatment is late and aggressive compared to peers. A 2024 review of the DAO legal landscape notes that U.S. federal regulation for crypto and DAOs is still pending, with only a few states (e.g., Wyoming) providing DAO LLC statutes, while at the federal level the SEC and CFTC have taken a “quite aggressive” approach illustrated by The DAO and Ooki DAO cases.(rif.technology) This contrasts with the proactive, purpose‑built DAO laws in places like the Marshall Islands and the more permissive foundation regimes in Switzerland and Cayman.

Taken together, this supports the spirit of Friedberg’s concern that a lot of the formal development, domicile and regulatory experimentation around DAOs has happened outside the U.S.

Evidence that the U.S. has not clearly been “left behind” overall

• U.S. still leads in crypto venture capital and startup funding. Multiple VC surveys show that from 2023–2025 the U.S. has remained the largest destination for crypto and blockchain VC funding, routinely capturing around 45–50% of global crypto VC capital and the largest share of deals, with the rest split among Europe and Asia.(fundfa.com) This indicates U.S. investors are still a primary driver of funding for Web3/DAO projects, even if those projects later incorporate abroad.
• DAO ecosystem is global and not obviously dominated by any single jurisdiction. Large empirical studies of thousands of DAOs (covering treasuries, token holders and governance activity) describe a fast‑growing, globally distributed ecosystem with over 13,000 DAOs and tens of billions in treasuries as of 2024, but they do not identify a clear geographic leader or show that U.S. participation is lagging in absolute terms.(arxiv.org) Many headline DAOs—Uniswap, Compound, Aave governance, Optimism Collective, etc.—have substantial U.S. contributors, teams or investors even when their legal entities are offshore.
• Patchwork but non‑trivial U.S. progress on DAO law. While the federal government has been slow, several U.S. states (Wyoming, Vermont, Tennessee, Utah) have passed statutes allowing DAOs or blockchain LLCs, giving them legal personhood and limited liability under state law.(stinson.com) That is materially behind some offshore competitors, but it is not zero, and U.S. entities do make use of these structures.
• Recent U.S. policy pivot toward a more crypto‑friendly stance. After an aggressive enforcement period under the prior administration, the Trump administration in 2025 has shifted tone: major SEC cases against Coinbase and Binance have been dropped or wound down, and the federal government has advanced crypto‑specific laws such as the GENIUS Act and even a Strategic Bitcoin Reserve to signal support for the sector.(reuters.com) Industry voices now talk about the U.S. risking falling behind if it fails to act, not as a country that is already definitively out of the race.(en.coinotag.com)

Why the prediction is ambiguous rather than clearly right or wrong

• The prediction ties together two claims: (1) non‑US crypto investments will drive development and adoption of DAOs and related structures; and (2) this will cause the U.S. to be left behind other jurisdictions.
• On (1), the legal‑domicile and regulatory evidence strongly supports that many of the key legal and structural innovations for DAOs (foundations, DAO LLC frameworks, offshore wrappers) have been pioneered and adopted outside the U.S., in Switzerland/Zug, the Marshall Islands, Cayman and other hubs.(ccn.com) So that part looks directionally accurate.
• On (2), “left behind” is much harder to substantiate. The U.S.:
  • Remains the single largest source of crypto venture capital, suggesting its investors still drive a large share of funding for DAO‑adjacent projects.(fundfa.com)
  • Hosts many of the major teams and contributors building DAO protocols, even when their legal entities are foreign.
  • Has begun shifting toward more supportive national policy in 2025, which undercuts the notion of a persistent or irreversible loss of leadership.(reuters.com)

Because different dimensions of “leadership” point in opposite directions—legal domicile and regulatory clarity favor ex‑US jurisdictions, while capital and much of the technical ecosystem remain heavily U.S.‑centric—and because no standardized metric exists to show that the U.S. is clearly behind in DAOs overall, the outcome of Friedberg’s prediction is best classified as ambiguous rather than clearly right or wrong.

As of November 30, 2025, the U.S. “accredited investor” framework has not been materially loosened beyond the SEC’s 2020 rule that added a few professional‑credential pathways (Series 7/65/82, knowledgeable employees, certain entities). The SEC’s own 2024–2025 guidance for accredited investors still cites the same income/net‑worth thresholds plus these limited professional categories, with no newer rule amendments implemented. (sec.gov)

Congress has moved several bills that would broaden access (e.g., the Accredited Investor Definition Review Act in the 118th Congress, H.R. 1579, which passed the House in 2023 but stalled in the Senate; and in the 119th Congress H.R. 3348 and the Equal Opportunity for All Investors Act of 2025, H.R. 3339, which would add exam‑based or credential‑based paths). However, as of now these remain proposals: H.R. 1579 never became law, H.R. 3348 is still at the House stage, and H.R. 3339 has only passed the House and is pending in the Senate. None has been enacted or implemented by the SEC. (congress.gov)

The SEC has issued a 2023 staff report reviewing the accredited‑investor definition and in 2025 received a petition for rulemaking to amend Rule 501(a), but these are analytical or preliminary procedural steps, not actual changes to who qualifies today. (sec.gov)

Policy discussions in 2023–2025 do show momentum toward broader retail access to private markets and proposals to base eligibility more on sophistication (credentials or exams) than pure wealth, but commentators describe these as prospective reforms under consideration, not yet in force. (barrons.com)

Given that:

• The prediction was open‑ended (“going to…force the accreditation laws to change”) rather than tied to a specific date, and
• No substantive loosening of U.S. accreditation laws or regulations has actually taken effect since the 2020 rule that pre‑dated the podcast,

we cannot say the prediction has come true by late 2025, but we also cannot definitively rule it out for the future. Therefore the status is best characterized as inconclusive (too early) rather than clearly right or wrong.

The prediction was that after the ConstitutionDAO episode in late 2021, more DAOs/crypto schemes would emerge that "rip people off," leading to heightened U.S. regulatory attention and a clamp‑down on such structures.

1. More harmful crypto schemes after ConstitutionDAO. ConstitutionDAO formed in November 2021 and quickly dissolved after failing to win the auction, marking a high‑profile early DAO experiment. (en.wikipedia.org) In the years immediately following, several very large crypto platforms and projects collapsed amid findings or allegations of fraud and massive investor losses, including:

   • Celsius Network, which froze withdrawals in June 2022, went bankrupt, and its founder Alex Mashinsky was later convicted and sentenced to 12 years for securities and commodities fraud that misled customers. (en.wikipedia.org)
   • Terraform Labs (TerraUSD/Luna), whose 2022 collapse wiped out an estimated $40 billion in value and led to a $4.47 billion SEC fraud settlement against Terraform and its founder Do Kwon. (reuters.com)
   • FTX, whose 2022 failure led to the conviction of founder Sam Bankman‑Fried on seven counts of fraud and conspiracy, with a 25‑year prison sentence and an $11 billion forfeiture order, one of the largest financial‑fraud cases in U.S. history. (en.wikipedia.org)
     These events clearly fit the pattern of additional crypto structures that severely harmed investors after late 2021.

2. Heightened U.S. regulatory interest and clamp‑down. In March 2022, the White House issued Executive Order 14067 on “Ensuring Responsible Development of Digital Assets,” directing a whole‑of‑government review focused on consumer/investor protection, systemic‑risk mitigation, and potential new regulation for digital‑asset issuers, platforms, and intermediaries — an explicit elevation of regulatory attention to crypto. (bidenwhitehouse.archives.gov) The SEC’s own enforcement statistics show a record‑breaking year in FY 2022 (760 enforcement actions and unprecedented penalties) and even more total actions in FY 2023, with the agency highlighting crypto‑asset securities as a major enforcement priority. (goodwinlaw.com)

   Regulators also began targeting DAOs and DeFi protocols directly. The CFTC’s case against Ooki DAO resulted in a 2023 default judgment treating the DAO as a "person" under the Commodity Exchange Act, imposing a monetary penalty, permanent trading and registration bans, and ordering shutdown of its website — a precedent‑setting clamp‑down on the idea that DAOs are “enforcement‑proof.” (cftc.gov) Subsequent legal commentary notes that Ooki DAO and related cases (e.g., Sarcuni v. bZx DAO, Houghton v. Leshner, True Return v. MakerDAO) are developing new theories of DAO liability that can expose token‑holding participants to joint responsibility, underscoring an intensifying legal and regulatory focus on DAOs. (reuters.com)

Together, the post‑2021 wave of damaging crypto/DAO schemes and the clear, measurable rise in U.S. regulatory scrutiny and enforcement — including actions specifically against DAOs and DeFi protocols — match the substance of Friedberg’s forecast. The prediction that such episodes would both harm investors and trigger a regulatory clamp‑down on these structures has, on balance, come true.

Chamath’s prediction matches what has actually happened.

1. SEC has repeatedly refused to treat DAOs as a special, oversight‑free structure
In its foundational 2017 “DAO Report,” the SEC held that tokens issued by The DAO were securities and emphasized that offers and sales by “virtual organizations” are subject to federal securities laws, explicitly warning that the “innovative technology” does not exempt such offerings or platforms from the existing regulatory framework and that Regulation Crowdfunding did not apply because the DAO wasn’t a registered broker‑dealer or funding portal. (sec.gov) Subsequent guidance and academic/compliance analyses of DAOs continue to treat them under the Howey test, stressing that DAO tokens that are securities must either be registered or forced into narrow exemptions with resale and distribution limits, rather than enjoying any carve‑out as a new structure. (corpgov.law.harvard.edu)

2. Enforcement posture: DAOs treated as entities to be policed, not privileged
When the first Wyoming‑chartered DAO, American CryptoFed DAO, tried to register its tokens (aimed at broad distribution) with the SEC, the agency halted the registration, alleging the filings were materially deficient and misleading, and then initiated proceedings to issue a stop order. (sec.gov) An ALJ issued an initial decision against the registration, and the Commission has kept the matter alive through 2024–2025 with repeated orders extending time to issue a final decision, rather than allowing the DAO to proceed. (sec.gov) Commentators describe this as an example of “severe SEC scrutiny” that effectively shut down Wyoming’s first authorized DAO, underscoring that federal regulators did not embrace a DAO structure even when a state tried to. (mondaq.com)

The CFTC has taken a similarly hard line. In the Ooki DAO case, it sued the DAO as an unincorporated association, won a default judgment, had the court declare the DAO a “person” under the Commodity Exchange Act, imposed a civil penalty, and ordered the website shut down. (cftc.gov) The CFTC’s enforcement director explicitly framed this as a “wake‑up call” to anyone who thinks adopting a DAO structure can evade regulatory accountability. (cftc.gov) That is the opposite of endorsing DAOs as a favored structure for retail investing.

3. No federal move to make DAOs a primary retail-investment channel
As of late 2025, there is still no dedicated federal regime granting DAOs special status as retail investment vehicles. Overviews of U.S. blockchain regulation note that DAOs and smart contracts are not specifically regulated at the federal level; instead, the SEC and CFTC have acted against DAOs that issue securities or financial products without proper registration, and even state‑recognized DAOs in Wyoming or Utah must still comply with federal law. (metlabs.io) Proposed legislation like the Lummis‑Gillibrand Responsible Financial Innovation Act would treat DAOs as business entities for tax and regulatory purposes, but it has not been enacted and does not turn DAOs into a privileged, low‑oversight channel for broad retail participation in private investments. (mayerbrown.com)

4. Ongoing industry complaints confirm regulators have not become supportive
In 2025, crypto policy groups like the DeFi Education Fund and the Uniswap Foundation are still publicly urging the SEC to “back off” from regulating most DAOs, arguing that applying Howey and securities regulation is inappropriate. (medium.com) The fact that this lobbying is even necessary—years after ConstitutionDAO and the podcast episode—strongly indicates regulators have not pivoted to a supportive stance that would let DAOs become a primary, lightly regulated retail investment mechanism.

Putting this together: U.S. regulators have consistently insisted that DAOs fit within existing oversight (securities and commodities laws), brought high‑profile enforcement cases against DAOs, blocked or slow‑rolled DAO token registrations, and declined to create a special, permissive regime for retail DAO investing. That behavior aligns closely with Chamath’s claim that the SEC and other regulators would not be supportive of DAOs as a primary mechanism for broad retail participation in private investments, because endorsing DAOs in that way would undermine their established oversight regime.

Evidence from 2021–2025 shows that no major expansion of U.S. equity‑crowdfunding law has actually been enacted during the Biden administration, and attempts to do so have struggled, which aligns with Sacks’s prediction that it would be “very hard” to expand these laws under the then‑current regime.

1. Reg CF limits have not been substantively expanded since 2021.
   The SEC’s own 2024 Regulation Crowdfunding overview still lists the same core framework as in early 2021: offerings must be conducted via registered intermediaries, and issuers may raise a maximum of $5 million in a 12‑month period, with standard investor limits and disclosure obligations.(sec.gov) That $5M cap comes from amendments adopted in November 2020 and made effective in March 2021—before or right as Biden took office—and were already in force months before the November 20, 2021 podcast.(en.wikipedia.org)

2. Post‑2021 changes have been technical inflation adjustments, not real liberalization.
   A 2023 American Bar Association review of 2022 regulatory developments notes that the SEC made inflation adjustments to various dollar thresholds in Regulation Crowdfunding (e.g., raising certain income/net‑worth thresholds and financial‑statement thresholds), but explicitly did not increase the overall $5M offering limit, because that had already been raised so sharply in March 2021.(americanbar.org) These tweaks modestly update numbers but do not broaden who can use Reg CF or how much capital can be raised in any transformative way.

3. A major expansion bill passed the House but stalled, with explicit White House opposition.
   H.R. 2799, the Expanding Access to Capital Act of 2023, included a title called the Improving Crowdfunding Opportunities Act, which would meaningfully expand equity crowdfunding by increasing how much can be raised and invested under Reg CF, loosening some issuer and portal requirements, and easing secondary trading constraints.(congress.gov) This bill passed the House in March 2024 but went to the Senate Banking Committee and has not advanced further.(congress.gov) The Biden Administration issued a formal Statement of Administration Policy strongly opposing H.R. 2799 on investor‑protection and worker‑classification grounds, signaling a clear lack of support for this style of liberalization.(presidency.ucsb.edu) This combination—House passage, Senate inaction, and White House opposition—is consistent with it being politically “very hard” to enact such expansions.

4. Even modest easing proposals remain only proposals as of late 2025.
   The ACCESS Act of 2025 (H.R. 3645) would make a narrower, technical change benefiting Reg CF issuers by raising the offering amount at which reviewed financial statements are required from $100,000 to $250,000, with authority for the SEC to go up to $400,000.(congress.gov) As of November 30, 2025, Congress.gov still shows the bill only reported out of committee and placed on the House Union Calendar, with status “Introduced” — it has not passed either chamber or become law.(congress.gov) So even relatively modest deregulatory adjustments have not yet cleared the full legislative process.

5. Advocacy for further expansion underscores that desired changes haven’t been achieved.
   Industry and policy groups continue to publish proposals under the banner of “JOBS Act 4.0” or similar agendas, calling for major improvements to Reg CF—such as lifting the cap to at least $10 million, more flexible investor limits, and broader use of special purpose vehicles—precisely because these expansions have not been adopted.(crowdfundinsider.com) The persistence of these campaigns without corresponding enacted reforms supports the view that getting real expansion through the current political and regulatory environment is difficult.

Putting this together: since Sacks spoke in November 2021, no substantial legislative or regulatory liberalization of U.S. equity‑crowdfunding law has actually taken effect, and the most ambitious expansion bill has been opposed by the administration and stalled in the Senate. The outcome matches his qualitative prediction that expanding crowdfunding laws under the Biden administration would be “very hard.”

Jason’s prediction tied the then‑current ConstitutionDAO raise (~$40–47M) to a 10x then 10x again scaling of DAO capital formation on roughly these milestones:

1. Within ~2 years of late 2021: see a DAO of roughly $400M scale (a ~10x from the ~$40M ConstitutionDAO example).
2. Within ~10 years of late 2021: see at least one DAO of roughly $4B in capital (another ~10x).

What actually happened by the two‑year mark (late 2023):

• ConstitutionDAO itself raised about $47M in November 2021 and then disbanded.

• The largest clearly comparable, single‑purpose crowdfunding DAOs that followed (e.g., AssangeDAO in early 2022) raised on the order of $50–55M, not hundreds of millions. AssangeDAO collected about 17,400 ETH (~$55M) to bid on the Censored NFT for Julian Assange’s legal defense – a bit larger than ConstitutionDAO in dollar terms but nowhere near $400M.

• Historically, even before this podcast, the biggest DAO crowdfund, The DAO (2016), had raised roughly $150M in ETH, which is still well below $400M and shows that the space has not progressed to a new 400M+ crowdfunding scale since.

• Looking at ecosystem‑wide DAO treasuries, the total value of DAO treasuries was already about $11.5B by late 2021, and by March 2023 it had grown to around $25.1B – roughly a 2× increase, not the 10× jump Jason was heuristically projecting. Over that period, top DAOs like Uniswap and BitDAO were already in the multi‑billion‑dollar range well before the two‑year deadline, and later layer‑2 DAOs like Optimism and Arbitrum reached $4–5B+ treasuries. Those figures show that large DAOs exist, but they mainly reflect token allocations and price movements, not new, ConstitutionDAO‑style capital raises on the order of $400M.

Given this, under any reasonable reading where “this $40M DAO will turn into a $400M one in the next two years” refers to the scale of new DAO fundraising / single‑DAO capital formation:

• No new DAO crowdfund anywhere near $400M appeared by late 2023. The largest high‑profile issue‑ or purchase‑focused DAOs (ConstitutionDAO, AssangeDAO, FreeRossDAO, etc.) all topped out at tens of millions, not hundreds.
• The 10x step from ~$40M to ~$400M within two years did not occur, so that time‑bound portion of the prediction failed. In compound predictions, failure of an early, necessary milestone makes the overall forecast wrong, even if later, less‑specific conditions (like the existence of some $4B‑scale DAO treasury) are or become true.

Therefore, as of November 30, 2025, Jason’s prediction that DAO capital formation would scale from ~$40M to ~$400M within about two years (and then to ~$4B within ten) is best judged wrong, primarily because the 400M‑scale DAO fundraising milestone was never reached in the stated two‑year window, and the overall 10x‑then‑10x growth story he sketched from the ConstitutionDAO example did not materialize.

Key sources:

• ConstitutionDAO raising about $47M in November 2021.
• The DAO (2016) raising roughly $150M as an earlier record‑setting DAO crowdfund.
• AssangeDAO raising on the order of $50–55M in early 2022, the largest well‑documented follow‑on crowdfunding DAO but far short of $400M.
• DeepDAO / Messari data on total DAO treasuries (~$11.5B at end of 2021; ~$25.1B by March 2023) and top DAO treasuries (Uniswap, BitDAO, Lido, Optimism, Arbitrum in the multi‑billion range).
• 2021 end‑of‑year analyses showing Uniswap and BitDAO already controlling treasuries of roughly $2–3B each, indicating large DAOs existed before but without any new 400M‑scale crowdfunding step in 2021–2023.

Ken Griffin bought a rare first-edition copy of the U.S. Constitution at Sotheby’s in November 2021 for $43.2 million. (forbes.com)

Subsequent reporting through 2024–2025 consistently describes the document as his copy, noting that he has loaned it for public exhibition (first to Crystal Bridges Museum of American Art in 2022, and then to the National Constitution Center in Philadelphia, where it is to be displayed through the U.S. 250th anniversary exhibits into 2026). (forbesla.com)

There is no record of any resale—at auction or privately—of this specific Constitution copy since the 2021 Sotheby’s sale. Given the extremely high-profile nature of the document and the extensive coverage of Griffin’s subsequent loans and related historic-document purchases, a resale (especially at roughly double the original $43.2 million price) would almost certainly have generated prominent press, yet none exists. (news.artnet.com)

Because Griffin still appears to own and loan the document and no evidence shows a resale within a year of the 2021 auction—let alone at about twice the price—the prediction that “in one year, he’ll sell it for twice as much” did not come true.