PUBLISHED: Fri, Dec 5, 2025, 5:35 PM UTC | UPDATED: Fri, Dec 5, 2025, 6:55 PM UTC
5 mins mins read
Photo: The Great Seal of the State of Wyoming (WyoFile)
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DUNAs solve three critical DAO problems: personal liability exposure, inability to contract with real-world entities, and tax compliance uncertainty
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Only 3 DUNAs exist after 18 months—Syndicate, Uniswap (DUNI), and WYDE—raising questions about adoption momentum despite major project interest
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Author's verdict: DUNAs are 'DAO 1.5' not 'DAO 2.0'—meaningful progress with real limitations, especially untested court interpretations
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Federal regulators (SEC, CFTC, IRS) aren't bound by Wyoming law, meaning state-level legitimacy doesn't guarantee federal compliance
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WYDE tests DUNA flexibility beyond DeFi, applying the framework to charitable governance and 501(c)(3) nonprofit funding allocation
DAOs have existed for nearly a decade. In that time, they've governed billions of dollars, launched major protocols, and faced legal actions that exposed their structural weaknesses. Now Wyoming offers what some call "DAO 2.0": a legal framework that gives decentralized organizations the legitimacy of corporations without sacrificing their governance model.
The question is whether DUNAs can deliver on this promise, or whether they represent another experiment that struggles to cross the gap between code and courthouse.
Based on analysis of the first 18 months of DUNA implementation, I believe DUNAs represent a genuine breakthrough for blockchain governance. Yet significant obstacles remain before they become the "industry standard" that proponents predict.
In this analysis:
Why DUNAs matter for the DAO ecosystem
Three arguments for "DAO 2.0" status
Three reasons skeptics remain unconvinced
What this means for WYDE and real-world use cases
What DUNAs Actually Solve
Before arguing about whether DUNAs are revolutionary, it helps to understand what problem they address.
DAOs that operate without legal entities face three specific risks:
Personal liability: Courts may treat them as general partnerships, exposing every member to unlimited liability for the organization's actions
Operational paralysis: They cannot contract with the real world. No bank accounts, no employment agreements, no vendor relationships
Tax uncertainty: No legal entity exists to report and pay obligations, creating compliance risk for all participants
The DUNA solves all three by creating a legal entity that recognizes blockchain-based governance. Members get liability protection. The organization can contract and appear in court. Tax obligations can be met through either corporate or nonprofit tax treatment.
According to Miles Jennings of a16z crypto, the DUNA "stops this vector of attack dead in its tracks" by giving DAOs what corporations have always had: legal existence separate from their members.
The Case for "DAO 2.0"
Argument 1: First Framework Purpose-Built for Decentralization
Previous attempts to give DAOs legal status forced them into structures designed for different purposes. Wyoming's DAO LLC tried to fit decentralized governance into a limited liability company form. Offshore foundations required centralized boards that contradicted the DAO ethos.
DUNAs are different. The framework was written specifically for organizations without centralized management. It allows smart contracts to serve as governing principles. It accommodates millions of members with token-based voting. As the statute explicitly states, membership can be conferred automatically through token purchases.
This matters because previous legal wrappers required DAOs to add centralization back into their structures. DUNAs do not.
Argument 2: Real Adoption by Significant Projects
DUNAs would be interesting legal theory if no one used them. Instead, within 18 months of the law taking effect:
Syndicate Network Collective launched as one of the first operating DUNAs (August 2024)
Uniswap governance adopted DUNI, making the largest DEX a legal entity (September 2025)
WYDE is launching $EAT as a DUNA-structured charitable token (December 10, 2025)
When the largest decentralized exchange in the world adopts a legal structure, that's a signal. Uniswap's DUNI proposal explicitly states that the structure will enable activities like protocol fee activation that were previously blocked by legal uncertainty.
Adoption by significant players suggests DUNAs solve real problems, not theoretical ones.
Argument 3: Tax Flexibility Enables Diverse Use Cases
The DUNA's ability to be taxed as either a corporation or a nonprofit organization creates flexibility that previous structures lacked.
DeFi protocols generating revenue can pay corporate taxes on their income, providing a clear compliance path. Charitable organizations like WYDE can pursue 501(c)(3) tax-exempt status. This flexibility means the same legal framework can serve both profit-generating protocols and mission-driven organizations.
A16z crypto confirms that "structured correctly, the DUNA can be tax efficient," eliminating a major barrier to bringing crypto projects onshore.
The Case Against Revolution
Counterargument 1: Courts Haven't Ruled Yet
The DUNA statute became effective in July 2024. No Wyoming court has interpreted it in a contested case. No federal court has ruled on how DUNA status affects securities analysis. Until judges apply the law to actual disputes, its practical meaning remains uncertain.
Legal frameworks often look different in courtrooms than they do on paper. DUNAs could work exactly as designed, or courts could find unexpected problems. We simply do not know yet.
Counterargument 2: Federal Regulators Aren't Bound by Wyoming
Wyoming created the DUNA framework, but the SEC, CFTC, and IRS operate under federal authority. If federal regulators decide that DUNA governance tokens are securities, Wyoming law won't stop them. If the IRS develops different interpretations of DUNA tax status, Wyoming courts can't override federal tax law.
The DUNA provides state-level legitimacy, which matters. But crypto's biggest regulatory battles happen at the federal level, where Wyoming's innovation has limited reach.
Counterargument 3: Only Three DUNAs Exist
Despite 18 months of availability, only three organizations have adopted the DUNA framework: Syndicate, Uniswap (DUNI), and WYDE. One additional major protocol (Compound) is considering it.
If DUNAs were truly "DAO 2.0," we might expect faster adoption. The limited uptake could reflect the framework's novelty, or it could indicate that most projects don't see sufficient value to justify the transition costs.
What This Means for WYDE and Real-World Use Cases
WYDE's adoption of the DUNA framework for charitable governance represents one of the most interesting tests of the structure's flexibility.
Extending DUNAs Beyond DeFi
Most DUNA discussion focuses on DeFi protocols: exchanges, lending platforms, and similar financial applications. WYDE applies the framework to philanthropy, using token-based governance to allocate charitable funding.
This matters because it demonstrates that DUNAs can serve missions beyond financial speculation. If WYDE succeeds, other social enterprises could adopt similar structures. The framework could enable new categories of democratic organizations that blend blockchain governance with real-world impact.
The WYDE Implementation
WYDE uses DUNA governance to determine which 501(c)(3) nonprofits receive funding from trading fees. When $EAT launches December 10, 2025, token holders will eventually vote on allocation priorities (governance activates Q2 2026). The DUNA structure gives these votes legal weight, enabling WYDE to enter binding contracts with nonprofit partners.
This is a practical test of whether DUNAs work for mission-driven organizations. The first year of WYDE operations will reveal whether the structure supports effective charitable giving or whether its complexity creates friction that undermines the mission.
Unique Challenges for Impact Applications
WYDE faces challenges that pure DeFi protocols do not:
Charitable partners operate under their own regulatory requirements
Impact measurement is harder to verify than on-chain transactions
Token holder interests may diverge from beneficiary needs
501(c)(3) tax-exempt status requires ongoing compliance
The DUNA provides legal infrastructure, but it cannot solve these operational challenges. WYDE's success depends on execution, community governance quality, and nonprofit partner performance.
The Nuanced Verdict
DUNAs are neither "DAO 2.0" nor a failed experiment. They represent meaningful progress with real limitations.
What DUNAs clearly provide:
A legal entity form designed for decentralized governance
Liability protection for governance participants
The ability to contract with the real world
Tax flexibility (corporate or nonprofit)
A framework that doesn't require re-centralization
What DUNAs cannot guarantee:
Federal regulatory acceptance
Court interpretations matching legislative intent
Success for every project that adopts the structure
Solutions to operational challenges unrelated to legal form
The most accurate assessment is that DUNAs are "DAO 1.5" rather than 2.0. They solve important problems that previous structures couldn't address, but they don't eliminate all friction between decentralized governance and real-world institutions.
For projects like WYDE that need legal standing to pursue their missions, DUNAs offer the best available option. For the broader ecosystem, the next two years will determine whether this promising framework becomes standard infrastructure or remains a Wyoming experiment.
What to Watch
Three developments will shape whether DUNAs achieve their potential:
Court interpretations: The first contested DUNA case will reveal how judges apply the statute
Federal regulatory signals: SEC and CFTC positions on DUNA-governed tokens
Adoption momentum: Whether projects beyond the current three choose the structure
For now, DUNAs represent the most thoughtful legal framework ever designed for decentralized organizations. Whether they become "DAO 2.0" depends on how the next chapters unfold.
Disclaimer: This analysis reflects the author's assessment based on publicly available information. It does not constitute legal or investment advice. Views expressed are those of the author and do not necessarily represent any organization. Always consult qualified professionals for your specific situation. Nothing described herein is currently available to purchase. Do your own research. The Tech Buzz is not affiliated with WYDE and receives no compensation for this coverage.
