The Law of Digital Organizations

Abstract

Abstract This chapter explores how digital infrastructure—particularly distributed ledger technologies (DLT)—is reshaping the legal architecture of organizational forms. Using decentralized autonomous organizations (DAOs) as a focal case, the chapter argues that legal and technical affordances must be treated as composable building blocks in the design of digital companies. Far from displacing law, DLT exposes its continued role in enabling, constraining, and legitimating organizational activity. Five legal affordances are identified—property, agency, fiduciary law, liability, and contract—as essential to institutional coherence, and the chapter examines how these interact with digital affordances in emerging organizational forms. Mapping a spectrum from traditional entities to “pure” DAOs, the chapter highlights the rise of techno-legal hybrids and proposes two future-facing models: an “internalization” model embedding legal structure in code, and an “externalization” model layering code onto legal shells. It concludes that digital companies are not just technical innovations but jurisprudential provocations—challenges to rethink law’s role in the design of institutional life.