### Introduction
**A Parallel Entity** is an umbrella term for an entity that exists simultaneously in two distinct realms: \ **the real world** (legal entity) and **the onchain world** (blockchain-based presence).
In essence, it represents a legal entity with a real-world presence, while also operating as an onchain entity governed by blockchain-based rules and smart contracts to leverage the best of both worlds.
For example: \
**A DAO LLC** is a Parallel Entity where the **LLC (Limited Liability Company)** exists in the legal world, while the **DAO (Decentralized Autonomous Organization)** operates on the blockchain.
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### How it works?
1.Set up a digital twin🌏🔀🌐
2.Sync it for parallel execution🔁
Parallel entity is now active☯️
#### Let’s break it down further:
{% stepper %}
{% step %}
**Legal Entity as the Base Layer (L1):**
Think of your Legal Entity as **the foundational base layer (L1) of your business operations**, **ensuring stability**, compliance, and clarity within the traditional legal framework. \
This includes traditional components like:
\- Articles of incorporation\
\- Bylaws\
\- Internal regulations
{% endstep %}
{% step %}
**Onchain Entity as Layer 2 (L2):**
The Onchain Entity is **your business operations' scaling layer (L2)**, **unlocking scalability**, efficiency, and transparency through onchain-native processes. It mirrors the legal structure but operates digitally, governed by smart contracts, and streamline+open:
\- Fundraising\
\- Ownership and rights distribution\
\- Corporate governance \
\- Decision-making process\
\- Dividends\
\- Asset management
{% endstep %}
{% endstepper %}
#### Example: DAO LLC
A DAO LLC is a perfect example of a Parallel Entity.
\- The **LLC** represents the legal, real-world layer.
\- The **DAO** operates as the onchain layer, where rules and operations are executed transparently using blockchain technology.
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