A new bill granting decentralized autonomous organizations legal status in the cryptocurrency-friendly state has been signed into law in Wyoming.
The bill, called the Wyoming Decentralized Unincorporated Nonprofit Association Act, also known as DUNA. signed Gov. Mark Gordon signed the bill into law Thursday.
a16zcrypto general counsel Miles Jennings said the bill was a “significant breakthrough.” friday on X. The venture capital fund advised on the bill and testified before state Senate and House committees.
“Wyoming’s new law will allow blockchain projects to operate within the scope of the law without compromising decentralization,” Jennings posted on X.
DAO has drawn the ire of U.S. regulators over the past few years. The Commodity Futures Trading Commission won a case involving Ooki DAO last year after the group failed to respond. that much Referee Set a precedent that other DAOs can be held liable for legal violations as “persons” under the Commodity Exchange Act.
Wyoming’s bill would give DAOs a legal existence, allowing them to enter into contracts with third parties, open bank accounts, appear in court and pay taxes, Jennings said. post About the new law.
“We achieve all of this without disrupting the way DAOs are currently launched and operate. It protects decentralization and positions DAOs to effectively grow the ecosystem of the underlying blockchain network,” Jennings said.
What does securities law mean?
The Securities and Exchange Commission often calls the Howey test. It is based on a 1946 U.S. Supreme Court case that the SEC often cites to determine whether assets qualify as securities. This test states that money must be invested in an ordinary business with the reasonable expectation that the asset will benefit from three components: the efforts of others;
Jennings said DUNA supports the argument that Howey’s third component is not satisfied. In part, this is because DUNA is “an inherently decentralized entity” and has no management functions such as officers and directors.
“Although the SEC’s theory of the applicability of U.S. securities laws to digital asset transactions is amorphous and constantly changing, the fact remains that it is bound by the Howey case law and subsequent case law. Pursuant to that case law, the adoption of DUNA is “It could be used by DAOs to strengthen the community’s argument against applying securities laws to their digital assets,” Jennings said.
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