Delaware Proposal to Authorize Blockchain-Based Stock Shares
In a significant move towards digital innovation, the Corporate Council of the Corporation Law Section of the Delaware State Bar Association has proposed amendments to the Delaware General Corporation Law (DGCL). The proposed changes aim to enable corporations to issue "Distributed Ledger Shares," a concept based on blockchain technology.
These amendments are part of the Delaware Blockchain Initiative, a program supported by the Delaware Governor to accommodate blockchain businesses. The main function of a holding company, which could potentially adopt this new method of share ownership, is to control its subsidiaries, often to consolidate power.
The distributed ledger technology can be applied to record and validate various digital assets, such as securities, commodities, property titles, derivatives, and more. Transactions in the distributed ledger do not require a clearinghouse intermediary, making it potentially cheaper, faster, and more efficient.
Distributed ledger is a blockchain-based share registration where each network user maintains a complete copy of the ledger. Bitcoin, the first major application of blockchain technology, paved the way for this digital revolution.
However, as of mid-2025, there is no direct indication from the search results that the DGCL has been amended by the Corporate Council to specifically allow corporations to issue Distributed Ledger Shares. The most relevant DGCL amendment noted concerns Section 220, effective March 25, 2025, which addresses stockholder inspection rights and seeks to reduce burdens on corporations related to demands for corporate records.
Federal legislative and SEC regulatory actions on digital assets have advanced, but no Delaware statutory amendment explicitly authorising issuance of shares via distributed ledger mechanisms has been identified in the provided sources. Companies such as Facebook, Messenger, Twitter, Pinterest, Linkedin, Whatsapp, and Email are not subsidiaries of a holding company, and thus, the specific companies or individuals that would be required to adopt the new method of share ownership remain unclear.
It is essential to note that this article does not discuss the potential challenges or drawbacks of using a holding company for investment management or the distributed ledger method of share ownership. Furthermore, the article does not provide information about the current status of the proposed amendments or when they might be enacted, nor does it mention any specific benefits that Delaware offers to SAAS startups in corporate formation, the benefits of incorporating in California for a holding company, or the tax implications of using a holding company for investment management.
For the very latest or upcoming proposed amendments beyond July 2025, consulting Delaware legislative archives or the Delaware Corporate Council’s announcements directly would be advisable.
- The proposed amendments to the Delaware General Corporation Law (DGCL) by the Corporate Council could revolutionize business finance, as they aim to enable corporations to issue Distributed Ledger Shares, a concept based on blockchain technology.
- As technology advances, the distributed ledger method of share ownership could potentially improve efficiency in business and finance, since transactions in the distributed ledger do not require a clearinghouse intermediary.
