Alabama has become the second U.S. jurisdiction to grant legal recognition to decentralized autonomous organizations (DAOs) under a new DUNA (Decentralized Unincorporated Nonprofit Association) law.
Senate Bill 277, filed in February by Republican Senator Lance Bell, cleared the Alabama House on March 17 by an 82-7 vote with 16 abstentions and was signed by Governor Kay Ivey, according to a16z Crypto. Industry observers, including Miles Jennings of a16z Crypto, say the move reflects a broader trend to formalize decentralized governance as a core part of crypto market infrastructure.
The DUNA Act gives qualifying DAOs entity status and limited liability protections, reducing long-standing legal uncertainty about how decentralized groups operate in the real world. That status enables DAUNAs to own property, enter contracts, sue and be sued, while generally shielding individual members and administrators from personal liability.
To qualify as a DUNA, an organization must have at least 100 members who join for a shared nonprofit purpose, such as governing a blockchain network or a smart-contract system. The law explicitly allows governance to be carried out on-chain via smart contracts, with voting, proposals and consensus mechanisms recorded on blockchain platforms.
A similar DUNA bill in West Virginia (HB 5060), sponsored by Representative Tristan Leavitt, passed that state’s House on March 4 and awaits the governor’s signature. Wyoming became the first state to enact DUNA legislation in March 2024 and previously approved the first legally recognized DAO in July 2021.
Globally, there are more than 13,000 DAOs, with combined treasuries exceeding $24.5 billion as of 2025, per CoinLaw. The average DAO treasury is roughly $1.2 million, and Ethereum plus its layer-2 networks host more than 85% of DAOs, according to PatentPC.
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