Categories: U.S. Regulation

Wyoming Wants to Become The Delaware of DAOs With New Crypto Law

Starting this summer, Wyoming will have a new system for managing and incorporating decentralized autonomous organizations as nonprofits (DAOs). Wyoming Governor Mark Gordon signed the Decentralized Unincorporated Nonprofit Association Act on March 8th.

This provides a framework for DAOs of at least 100 members to become unincorporated nonprofit associations. The new law will go into effect July 1, 2024. The bill passed with bipartisan support in the Wyoming House Monday in a 50-10 vote. Four Democratic Representatives moved to advance the measure.

The Decentralized Unincorporated Nonprofit Association Act, first introduced in February, passed the Senate last month in a 23-7 vote with four Democrats voting in favor. Under the law, DAOs registered as nonprofits are permitted to “engage in profit-making activities” so long as all proceeds are directed back to achieving the nonprofit’s “purpose.”

The entities are also allowed to acquire and transfer property, including tokens. “Wyoming’s new law will enable blockchain projects to operate within the bounds of applicable laws without compromising their decentralization,” Miles Jennings, general counsel at a16z crypto, wrote on X Friday. “It also keeps them permissionless.”

Back in 2021, the state passed the Wyoming Decentralized Autonomous Organization Supplement Act, which added DAOs to Wyoming’s existing limited liability corporation (LLC) laws. The bill gave DAOs the first legal framework to be created and managed in the state

Terron Gold

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