Written Actions and Consents: Why Your LLC Needs Paper Even When the Blockchain Remembers Everything #
Your blockchain transaction history is perfect. Every movement timestamped, cryptographically verified, publicly auditable. And legally speaking, it means almost nothing without the right paperwork.
Written actions and consents are formal documentation that your LLC approved specific financial decisions. Think of them as meeting minutes that prove the entity authorized what happened. You need them for capital contributions (when you put money in), distributions (when you take money out), asset transfers, trades, loans, staking operations, and custody changes.
The blockchain shows movement. It doesn’t show authority. A transaction ID proves that wallet A sent tokens to wallet B at a specific time. It doesn’t prove the LLC voted to make that transfer, that the managing member had authority to execute it, or that the decision followed your operating agreement. Courts don’t read smart contracts. They read corporate resolutions.
Here’s the problem most people miss: your LLC is a legal entity under state law. State law requires formal decision-making processes for major actions. You can’t just move assets because you feel like it. The entity has to approve the action through proper channels. If you’re the sole member, you still need to document that you, acting as the managing member, authorized the transaction on behalf of the LLC.
Capital contributions need written consent because they establish basis and ownership percentages. Distributions need documentation because they affect member equity and trigger tax reporting. Trades and swaps need approval because they’re investment decisions made with entity assets. Loans require authorization because they create liability. Staking is trickier than people think because you’re often delegating control of assets, which needs explicit approval. Custody changes matter because they affect who controls the entity’s property.
Without this paper trail, you’re back to the corporate veil problem. When an LLC makes decisions without following its own rules, courts start questioning whether it’s really a separate entity or just you wearing a legal costume. The blockchain proves you moved the assets. Written consents prove the LLC moved the assets.
This gets complicated fast when you’re managing significant wealth across multiple entities. A registered investment advisor operating as a fiduciary can help structure these decisions properly. Digital Wealth Partners provides wealth management services with the compliance infrastructure to document investment decisions correctly. Their asset custody protocols include proper authorization workflows.
At higher asset levels, the documentation burden grows exponentially. You’re not just recording one LLC’s decisions anymore. You’re coordinating actions across multiple entities, tracking inter-company transactions, managing trust distributions, and ensuring everything ties together for tax purposes. Family office services become essential because someone needs to see the whole structure and make sure the paperwork matches reality.
Digital Ascension Group handles this coordination through comprehensive family office services. They document multi-generational planning decisions, oversee estate and succession actions, coordinate tax strategy implementations across entities, and maintain the written record that proves everything was done properly. When you’re dealing with complex structures, the documentation isn’t separate from the strategy. It’s what makes the strategy defensible.
The blockchain is beautiful technology for tracking what happened. But legal protection comes from proving who authorized it and why. That still requires signatures on paper, or at least proper electronic consents that meet state law requirements.
Contact Digital Ascension Group to learn how our family office services can coordinate your complete financial picture.
