Wyoming Pioneers New Legal Status for DAOs, Drawing Praise from A16z

Wyoming has introduced a groundbreaking legal structure for DAOs, signing into law a provision establishing them as “decentralized unincorporated nonprofit associations.” This move has garnered praise from investment firm A16z, which hailed Wyoming as an “oasis” for such entities.

Building upon existing regulations that allowed DAOs to operate as limited-liability corporations within the state, this new legislation enables them to formalize themselves as unincorporated nonprofit associations. A16z Crypto’s general counsel, Miles Jennings, lauded this development as a significant advancement, providing essential protections to these groups and empowering them to maintain open blockchain networks.

Referred to as “decentralized unincorporated nonprofit associations” (DUNAs), this legal recognition addresses key challenges faced by DAOs, including granting them legal standing for contracting, taxation capabilities, and limited liability protection against the actions of other members.

A16z has committed to guiding the DAOs it’s affiliated with towards this legal status and will prioritize future investments in entities pursuing this legal pathway.