Wyoming has become the first US state to grant legal recognition to Decentralized Autonomous Organizations (DAOs).
Governor Mark Gordon signed the Wyoming Decentralized Unincorporated Nonprofit Association Act, also known as DUNA, into law on Thursday.
DAOs are internet-native communities with shared goals, typically managed by code and smart contracts.
Their decentralized nature has previously posed challenges for regulators, with the Commodity Futures Trading Commission successfully holding a DAO liable for legal violations in 2023.
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The DUNA act grants DAOs legal existence, allowing them to enter contracts, open bank accounts, appear in court, and pay taxes.
Importantly, it achieves this without interfering with the internal structure and operation of DAOs, preserving their core decentralized nature.
The new law is seen as a major breakthrough for DAOs, which have faced regulatory uncertainty in recent years.
Miles Jennings, general counsel for the crypto-focused venture capital firm a16z crypto, praised the legislation, highlighting its ability to “enable blockchain projects to operate within the bounds of applicable laws without compromising their decentralization.”
2/ Wyoming’s new law will enable blockchain projects to operate within the bounds of applicable laws without compromising their decentralization. It also keeps them permissionless.
This is a major breakthrough.
— miles jennings (@milesjennings) March 8, 2024
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