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The US state of Alabama has become the second US jurisdiction after Wyoming to grant decentralized autonomous organizations (DAOs) legal status under the DUNA Act.The Decentralized Unincorporated Nonprofit Association (DUNA) Act (Senate Bill 277) was <a href="https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2026RS/SB277-enr.pdf" rel="noopener noreferrer nofollow">introduced</a> in February by Republican Senator Lance Bell. The House <a href="https://legiscan.com/AL/rollcall/SB277/id/1661282" rel="noopener noreferrer nofollow">passed</a> it 82-7 with 16 abstentions on March 17, and has now been signed by Alabama Governor Kay Ivey, according to a16z Crypto.Speaking about the bill’s passage, a16z Crypto’s head of policy and general counsel, Miles Jennings, <a href="https://x.com/milesjennings/status/2039480778124574721" rel="noopener noreferrer nofollow">said</a> on Wednesday that “decentralized governance is essential to crypto’s future — it’s one of the core constructs in market structure legislation.”The bill provides legal status and limited liability protections to <a href="https://cointelegraph.com/news/lido-dao-weights-20m-ldo-buyback-plan" rel="noopener noreferrer nofollow">DAOs</a>, solving a long-unresolved question in crypto: How DAOs exist from a legal standpoint in the real world.&nbsp;It gives decentralized communities “the certainty to build, govern, contract, and scale in the real world,” added Jennings.&nbsp;<h2 id="full-legal-entity-status-for-daos">Full legal entity status for DAOs</h2>To qualify, a DAO must have at least 100 members joined for a common nonprofit purpose, such as governing a blockchain network or smart contract system.Governance can operate entirely through blockchain technology and smart contracts, and voting, proposals and consensus mechanisms can all be stored onchain.These organizations will have full legal entity status, they can own property, sue and be sued, and enter into contracts, while individual members and administrators will be shielded from personal liability.&nbsp;Related: <a href="https://cointelegraph.com/news/aave-dao-backs-v4-deployment-near-unanimous-snapshot-vote" rel="noopener noreferrer nofollow">Aave DAO backs V4 mainnet plan in near-unanimous vote</a>“As federal crypto market structure legislation moves closer to becoming law, builders need effective domestic legal structures,” added Jennings.&nbsp;<h2 id="west-virginia-duna-act-awaits-approval">West Virginia DUNA Act awaits approval&nbsp;</h2>A similar DUNA bill (<a href="https://www.wvlegislature.gov/Bill_Status/bills_history.cfm?INPUT=5060&amp;year=2026&amp;sessiontype=RS" rel="noopener noreferrer nofollow">HB 5060</a>), introduced by Representative Tristan Leavitt in February, passed the House on March 4 and is awaiting the governor’s signature in West Virginia.&nbsp;Wyoming’s DUNA Act was signed into law by Governor Mark Gordon in March 2024. The state <a href="https://cointelegraph.com/news/wyoming-legally-recognizes-first-dao-in-the-united-states" rel="noopener noreferrer nofollow">approved</a> the first legally recognized DAO in the United States in July 2021.&nbsp;Over 13,000 DAOs exist worldwide with collective <a href="https://cointelegraph.com/news/dao-treasuries-top-25-billion-for-the-first-time-deepdao" rel="noopener noreferrer nofollow">treasury</a> assets under DAO control surpassing $24.5 billion as of 2025, <a href="https://coinlaw.io/dao-treasury-holdings-statistics/" rel="noopener noreferrer nofollow">according</a> to CoinLaw. The average DAO treasury size is around $1.2 million, and Ethereum and its layer-2 networks host over 85% of DAOs, <a href="https://patentpc.com/blog/dao-growth-stats-treasury-sizes-governance-votes-activity" rel="noopener noreferrer nofollow">reported</a> PatentPC in March.<figure><img alt="Law, DAO" src="https://s3.cointelegraph.com/uploads/2026-04/019d4cc0-7e71-709e-8096-e2dfd088f670.jpg"><figcaption>DAO treasury composition. Source: CoinLaw</figcaption></figure>Magazine: <a href="https://cointelegraph-magazine.com/newbies-guide-surviving-crypto-winter/" rel="noopener noreferrer nofollow">Your guide to surviving this mini-crypto winter</a>

Alabama becomes second US state to grant DAOs legal status under DUNA

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