GIP: #129
title: Should GnosisDAO establish Seldon Inc and appoint a Gnosis VPN Committee to support the Gnosis VPN project?
author: Sebastian Bürgel on behalf of HOPR Association
status: phase-1
type: funding
created: 2025-07-23
Summary
In GIP-98, Gnosis DAO approved initial research and development for an anonymous VPN running on top of the HOPR mixnet, called Gnosis VPN. After a successful proof of concept, in GIP-122, GnosisDAO approved further development to bring the project to market over two years.
HOPR is responsible for developing the software for the first version of Gnosis VPN, including the Gnosis VPN client itself and improvements to the HOPR mixnet and HOPR Session Protocol needed to make Gnosis VPN work. However, the goal is for Gnosis VPN to be a standalone project entirely separate from the underlying infrastructure and the HOPR team.
To achieve this, Gnosis VPN already requires a legal entity to interact with various vendors and service providers. It also needs a simple governance structure to make decisions and instruct this entity.
This proposal seeks approval to incorporate a new legal entity and establish a delegated Gnosis VPN Committee to instruct it. The proposed name will be Seldon Inc, subject to it being accepted by the local authorities. Otherwise, alternative names given for the entity are Mallow Inc and Maelcum Inc.
This proposal will explain the rationale for Seldon Inc, its structure and initial operational budget, as well as the committee’s structure and mandate.
Motivation
Why does Gnosis VPN need a dedicated entity? We expect Gnosis VPN to play a fundamental role in achieving Gnosis’ goal of creating the open internet. Anonymous, unblockable, and uncensorable internet access is essential for sovereign digital identity. VPN services are also big business, with an estimated annual market size of $130bn by 2030. Estimates for 2024 (made in 2020) were all exceeded, so there’s a strong chance that this 2030 estimate will prove conservative (sources: [1], [2], [3], [4]).
It was always envisioned that Gnosis VPN would grow to be its own project, separate from HOPR and Gnosis Ltd. Once Gnosis VPN is market ready, it will need to scale, and the primary focus will shift from software development to business development. HOPR is not necessarily best placed to provide this, and in the spirit of web3 it is wise to separate the infrastructure layer from the services running on top of it.
There are, broadly speaking, three legal options for stewarding a project like Gnosis VPN:
- Use no incorporated entity at all
- Run Gnosis VPN using an existing Gnosis entity
- Establish a new entity for Gnosis VPN
The first may seem appealing for an anonymous web3 VPN powered by a mixnet, but this is infeasible. The goal is to make Gnosis VPN accessible to everyone, which requires a streamlined UX and ready availability of the Gnosis VPN software. On mobile this means being listed in app stores, which will require an incorporated entity to apply for and maintain the listing.
It is also not desirable to subsume Gnosis VPN under an existing Gnosis entity, as Gnosis has a longstanding tradition of decentralization on this front. Like all VPNs, Gnosis VPN is likely to face some level of regulatory scrutiny, which also makes it unwise to lump it together with other Gnosis entities.
Why now?
So Gnosis VPN needs an entity. But why is an entity required now?
Although the first market-ready version of Gnosis VPN is not expected until the end of GIP-122 in 2026, Gnosis VPN is already usable as a proof of concept and will see several increasingly accessible versions throughout 2025 and 2026.
Gnosis VPN exit nodes and other infrastructure are currently operated by Gnosis Ltd, but this is only a temporary solution, made feasible by the small number of users.
The PoC gives users access to the wider internet via a bespoke type of HOPR node called an “exit node”. Users select an exit node located in a country of their choice, and it is these nodes which actually access the internet on the user’s behalf. These initial exit nodes are currently hosted alongside other important Gnosis infrastructure. It would be prudent for these nodes to be run by a different entity.
How Gnosis VPN will provide IPs to users
VPNs are essential but controversial services, and often subject to takedown notices. To mitigate this risk, the plan is that the entity controlling Gnosis VPN will lease IP subnet ranges as needed for its exit nodes to be used. In the unlikely event that these IPs are blocked and more IPs are needed, new ranges can be leased and the old ones abandoned. This is a relatively inexpensive approach ($120 per month), and easy to register.
While we think takedown requests are unlikely, there is a chance that if cloud providers take exception to Gnosis VPN it could have serious consequences for other services managed by Gnosis Ltd. To avoid this risk, it makes sense for Gnosis VPN virtual machines to be run under a different contract.
At the same time, the entity in charge of Gnosis VPN already needs to interact with various vendors and service providers. In addition to leasing the IP addresses and setting up a GCP contract, Gnosis VPN should begin the process of getting its software listed in the Google and Apple app stores. All of this requires a legal entity able to sign contracts and make payments.
Although we expect this entity to be minimally active during GIP-122, establishing it already will lay the groundwork for future scaling. To this end, we also propose setting up a lightweight governance structure, the Gnosis VPN Committee, to take current decisions and begin the work of transitioning Gnosis VPN to an independent project.
This would take the form of a three-person committee able to give instructions to the board of Seldon Inc, with one member chosen by each of Gnosis Ltd, Gnosis DAO and HOPR (“Gnosis VPN Committee”). This structure ensures accountability while preserving GnosisDAO governance at a strategic level.
Incorporation and Role of Seldon Inc
In consultation with the Gnosis Ltd legal team, an extensive jurisdictional analysis was conducted and Panama has been selected as the most appropriate jurisdiction for incorporating Seldon Inc for the following reasons:
- We are committed to user privacy and data protection. Panama offers a regulatory environment that aligns with these principles—specifically, there are no mandatory data retention laws applicable to VPN services. This enables us to operate under a strict no-logs policy while remaining compliant with local laws.
- Panama’s legal framework is not subject to intrusive international data-sharing agreements or oversight from foreign jurisdictions. This independence allows Gnosis VPN to offer a service where user confidentiality is central, and where we are not legally obligated to collect, monitor, store, or share user information or activity. Additionally, Panama’s non-intrusive regulatory approach ensures that our infrastructure can operate with minimal risk of undue pressure or surveillance demands, helping us deliver a secure, privacy-first VPN experience for all users.
- Incorporation and operational costs are low.
- Panama is the jurisdiction of choice for other VPNs, such as industry-leading NordVPN.
Purpose
- Execute the day-to-day operations of Gnosis VPN.
- Interface with vendors, contributors, and external partners.
This may seem vague, but we’ve been advised that it is sound legal strategy for the purpose and bylaws to provide a wide and flexible mandate that allows Seldon Inc to engage in a broad range of commercial and operational activities. In practice, this would include the ability to develop, distribute and commercialise technology products and services, manage financial and banking operations, enter into contracts of all types, and hold or transact in various forms of property, including fiat and crypto. We believe this aligns with this GIP’s general goal of enabling effective execution and risk management.
Ownership Structure
Seldon Inc will be 100% owned by Gnosis DAO Operational Foundation (Cayman). This structure ensures continued ownership by the Gnosis DAO.
Operational Legal Costs
Establishing this entity in Panama will incur the following legal costs:
- Incorporation: up to USD 5,110
- Annual: up to USD 4,300
Payment can be made in crypto, subject to a 3% fee.
Governance
The entity would be required to have a board of three directors appointed by a local agent in Panama. However, no control need be ceded to this board: the bylaws of the entity would dictate that all decisions must be approved by the Gnosis VPN Committee and the board must follow the instruction of the Gnosis VPN committee.
More formally, the following terms of reference (“Terms of Reference”) would govern the Gnosis VPN Committee:
- Mandate:
- Act as a liaison between Gnosis DAO, Gnosis Ltd, HOPR, and Seldon Inc.
- Instruct Seldon Inc on all matters in relation to the Gnosis VPN project, including but not limited to:
- i. execution of any contracts, partnership agreements, letters, transactions, or any other form of agreement that Seldon Inc is required to enter into;
- ii. approval of any financial related matters including accounts, budgets, audit statements, or otherwise;
- iii. appointment and removal of directors to the board of Seldon Inc; and
- iv. approval of any other operational matters in relation to Seldon Inc
Instruct Gnosis DAO Operational Foundation (Cayman) in relation to its capacity as shareholder of Seldon Inc on all matters of corporate and shareholder governance in respect of Seldon Inc.
Update the Gnosis DAO on the activities of Seldon Inc and the Committee, as appropriate and at least once a quarter.
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Appointment and removal of Committee Members:
- Subject always to the overriding appointment and removal rights of the GnosisDAO (as further outlined below), the committee shall consist of [3] members, namely:
-
one person appointed and removed by the HOPR Association (the “HOPR Appointee”). The first HOPR Appointee shall be Tino Breddin.
- one person as appointed and removed by Gnosis Limited, who shall be infrastructure / product focused (the “Ltd Appointee”). The first Ltd Appointee shall be Philippe Schomers
- one person as appointed and removed by the Gnosis DAO (the “DAO Appointee”). The DAO first appointee should be selected by Gnosis DAO as part of the phase 1 deliberations for this proposal. The selected appointee will then be named in the GIP which passes to phase 2. We encourage the current DAO delegates to select one of their number for this position.
(together the HOPR Appointee, Ltd Appointee, and the DAO Appointee are the “Committee Members”, and each a “Committee Member”).
None of the Committee Members shall be entitled to remuneration in respect of their appointment as a Committee Member.
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Term
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The Committee Members shall be elected for a term of one (1) year.
- With regards to the HOPR Appointee, HOPR Association may reappoint the currently appointed HOPR Appointee for a further term of one (1) year, or it may appoint a new HOPR Appointee.
- With regards to the Ltd Appointee, Gnosis Ltd may reappoint the currently appointed Ltd Appointee for a further term of one (1) year, or it may appoint a new Ltd Appointee.
- With regards to the DAO Appointee, thirty (30) days prior to the conclusion of each term, a re-election window will be opened. During this period any member of the Gnosis DAO may nominate alternative candidates for the position of the DAO Appointee by proposing an alternative candidate to the community (via GIP or otherwise).
- If a new DAO Appointee is proposed, the nomination shall be put to a poll vote of the GnosisDAO.
- The candidate receiving the majority of votes in the GnosisDAO poll shall be appointed as the DAO Appointee.
- If no alternative nominations are made for the position of DAO Appointee, the current DAO Appointee shall automatically remain in position for the subsequent one-year term.
- There is no limit to the number of consecutive terms a Committee Member may serve.
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Quorum
- A quorum shall consist of a majority of Committee Members (i.e., two out of three).
- No meeting of the Gnosis VPN Committee shall proceed to business unless a quorum is present.
- Decisions shall be made by a simple majority vote of those present.
- In the event of a tie, no Committee Member shall have a casting vote.
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Variation of the Terms of Reference
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Notwithstanding any other term of the Terms of Reference, Gnosis DAO can at any time by means of a Gnosis Improvement Proposal (GIP):
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appoint and remove any Committee Member;
- amend or remove the appointment rights of the HOPR Association, or Gnosis Ltd in respect of any Committee Member;
- amend the maximum or minimum number of Committee Members;
- otherwise amend, remove, or replace the structure of the Gnosis VPN Committee, or make any other amendment to the mandate conferred under these Terms of Reference.
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Unless explicitly provided herein, GnosisDAO does not have the authority to retroactively cancel, reverse, or override specific operational decisions made by the Gnosis VPN Committee or Seldon Inc.
Expected Committee Actions
It’s impossible to fully explicate all actions which the Gnosis VPN Committee might need to take, but at least for the duration of GIP-122 the Gnosis VPN Committee is expected to primarily operate in a communication and approval role, by taking the following actions:
- Instruct the Board of Seldon Inc as needed to establish the necessary contracts for Gnosis VPN to operate (cloud computing platforms, leasing IP subnet, app store listings, etc.).
- Respond in a timely fashion to any developments related to these contracts.
- Assess and report on the development milestones laid out in GIP-122.
- Interface with the Gnosis DAO community to provide transparency.
- Post updates to the Gnosis DAO forum on at least a quarterly basis.
- Ensure separation of concerns with HOPR while maintaining compatibility where relevant.
The quorum rules explained above mean that two out of three Committee Members are able to call a meeting of the Gnosis VPN Committee, but if they disagree on a decision, the only way to break the tie is to reconvene with the third member present. This feels like the correct balance between remaining dynamic while maintaining checks and balances.
As we move out of GIP-122, we expect this governance structure to evolve to see Seldon Inc taking a more executive role in the further development of Gnosis VPN. Although this may end up looking very different to the current structure, we think it’s wise to lay the foundations of this now, with a plan to further develop this with the coordination of Gnosis DAO and the Gnosis VPN Committee in 2026.
Budget
In addition to the legal costs outlined above, Seldon Inc requires a modest operational budget, mostly earmarked for devops and infrastructure costs. Current estimates are for 14 virtual machines, with a range of specifications, to handle gnosisvpn-js and exit nodes in staging and production. A 20% buffer is included in case specifications change, with any further increase requiring a request to the DAO from the Gnosis VPN Committee. The budget below includes all projected costs, including the monthly directors’ fee but not the one-off incorporation fee (to be confirmed, up to $5,110)
Note that Seldon Inc is also expected to earn revenue via its exit nodes, although the amounts will depend on user numbers and traffic. If the exit nodes are also used as relay nodes in the HOPR mixnet, they will earn HOPR tokens for relaying, as well as the cover traffic which is distributed to all eligible HOPR nodes.
| Item | Description | USD / month |
|---|---|---|
| Cloud Computing | 14 virtual machines | 1,950 |
| Networking | ~10% of infra costs | 195 |
| Support | ~20% of infra costs | 390 |
| Seldon Admin | Panamanian Director Fees | 360 |
| IP Leasing | /24 IP range subnet | 120 |
| Google Workspace | Business Starter (5 users @ $8/mo) | 40 |
| Buffer | 20% costs buffer | 611 |
| Monthly Total (Pre-Tax) | 3,666 | |
| Tax | VAT @ 21% | 770 |
| Monthly Total (Post-Tax) | 4,436 | |
| **Annual Total (Post-Tax) | $53,232** |
Support from other services within the Gnosis Ecosystem
Although Gnosis VPN is conceived as an independent project, it will naturally receive support from elsewhere in the Gnosis ecosystem. HOPR will provide the largest input here, particularly during the two years of GIP-122, being responsible for technical product development of the Gnosis VPN exit application and client apps as well as the underlying HOPR protocol and client apps.
However, Gnosis VPN will require other support and assets, legal, community and frontend support, as well as tokens (HOPR tokens and xDAI) to run its nodes. These token amounts are modest, but do need to be sourced from somewhere.
The nature and source of this support will ultimately be up to the committee to decide, but the following is a speculative list of what Gnosis VPN might require and where it might get it from:
| Other services / assets | Provided by |
|---|---|
| Software development | HOPR Association |
| Software deployment | Gnosis Ltd |
| RPC provision | Gnosis Ltd |
| HOPR token | DAO |
| xDAI token | DAO |
| Legal support | Gnosis Ltd |
| Community support | Gnosis Ltd |
| Design, frontend, website deployment | Gnosis Ltd |
| Gnosis VPN level 2 support | HOPR Association |
None of these are currently expected to incur any costs, although in future this might change.
Conclusion
Approving this proposal will enable GnosisDAO to efficiently scale Gnosis VPN with appropriate legal and operational infrastructure, while maintaining GnosisDAO oversight and alignment with the broader Gnosis ecosystem. While we don’t expect the entity or committee to take many actions in the first 12 months, we think it’s important to lay the groundwork well in advance to give Gnosis VPN the best chance to thrive.
