- A measure was signed into law by Wyoming Governor Mark Gordon.
- A DAO may be held responsible without involving its individual members.
Decentralized autonomous organizations (DAOs) now have a legal framework thanks to a measure signed into law by Wyoming Governor Mark Gordon.
Furthermore, the Select Committee on Blockchain, Financial Technology and Digital Innovation Technology of the legislature supported the law, which establishes a formal framework for decentralized unincorporated non-profit organizations (DUNAs) operating inside the state.
Granted Legal Existence
Moreover, the rules for DUNA formation, smart contract functions, and member and association legal obligations are all laid out in the March 7th enactment. As a result of the new legislation, a DAO may be held responsible without involving its individual members as a DUNA is a distinct legal entity from them.
A decentralized autonomous organization (DAO) does not have any top-down central authority. The community is regulated by a set of rules enforced by a blockchain, and the decision-making process is bottom-up. Also, a decentralized autonomous organization (DAO) may enter into contracts with outside parties, create bank accounts, pay taxes, and comply with reporting obligations if it is granted legal existence.
The venture capital company a16z crypto made the claim in a report published on March 8th that the new law’s non-profit classification is misunderstood.
Moreover, it is not illegal for a Wyoming-based DAO to engage in for-profit operations, according to Miles Jennings, general counsel at a16z, and David Kerr, partner at Cowrie law firm. As per the analyst, from the data, DAOs can also compensate their members, maybe even in return for their input during governance.
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