Of course in reality the main goal would be to be able to create your shell companies in that virtual country so that you don't have to deal with a potential political change in the cayman islands. I can imagine that goal is very attractive to some, but I don't really see that as a positive for society as a whole.
Countries don't just spring up and start offering passports. A country isn't a country unless other countries recognize it as such. That's why calling Taiwan a country or a part of China is such a big deal. If doing so would undermine their own sovereignty and monopoly on power, why would they do this?
If something like this happens, it won't be island counties trying to attract digital nomads. It will be big tech companies who want to create little city-states of tech workers without having to worry about laws and immigration restrictions.
That's the issue with the power of the existing system of countries - you can go claim to form your own online country if you want, but it only exists inasmuch as other countries agree it does. The US isn't going to allow you to set up an embassy because to do so it would have to agree to redefine the concept of what a nation is, and as one of the most powerful nations on earth, that's clearly not in its interest.
Now imagine a digital country. What’s the fundamental difference? You’re still interacting with an entity that is far away.
If an organization arose that provided benefits to members in a way similar to actual citizenships, it would likely be competitive and desirable. If this digital country managed to make itself valuable to established states, whether through money, talent, or otherwise, I see no reason why it couldn’t thrive and be comparable to tiny island nations like Vanuatu.