Alabama has joined a growing list of U.S. states formalizing the legal status of decentralized autonomous organizations (DAOs). On March 17 the state legislature passed the Decentralized Unincorporated Nonprofit Association (DUNA) Act by an 82–7 vote with 16 abstentions; Governor Kay Ivey has since signed the measure into law.
The DUNA Act, introduced in February by Republican state Senator Lance Bell, grants DAOs limited liability and formal recognition as legal entities. Under the law, qualifying DAOs can own property, enter contracts, and sue or be sued—while shielding individual members from personal liability for disputes that arise from DAO operations.
To qualify, an organization must have at least 100 members united for a common nonprofit purpose (for example, governing a blockchain network or managing a smart contract system). Governance functions such as voting, proposals and consensus mechanisms may be executed and recorded on-chain via blockchain technology and smart contracts.
Industry observers see the move as part of a broader push to give crypto-native governance structures a clearer legal footing. Miles Jennings, head of policy and general counsel for a16z Crypto, called decentralized governance “essential to crypto’s future” and said the bill provides “the certainty to build, govern, contract, and scale in the real world.” He also noted the importance of domestic legal structures as federal crypto market structure legislation advances.
The Alabama law follows Wyoming, which in 2024 became the first state to adopt DUNA-style recognition for DAOs. CoinLaw estimates there are more than 13,000 DAOs worldwide controlling roughly $24.5 billion in assets—underscoring why states are racing to define how these entities fit into existing legal systems. A similar DUNA bill was introduced in West Virginia in February by Representative Tristan Leavitt and is currently awaiting the governor’s signature.
For crypto projects and communities structured as DAOs, Alabama’s law offers a pathway to operate with clearer legal protections and conventional corporate capabilities—potentially easing partnerships, contracts and real-world scaling.
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