Alabama has become the second U.S. state to approve a legal framework for decentralized autonomous organizations (DAOs) with the passage of Senate Bill 277. This legislation establishes a structure for decentralized unincorporated nonprofit associations (DUNAs), allowing them to exist as separate legal entities capable of holding property, entering contracts, and participating in legal proceedings. Members of these organizations are not personally liable for the group's obligations solely due to their membership. The framework, however, is limited to nonprofit purpose organizations with at least 100 members. It permits the use of smart contracts and distributed ledger tools for governance. Although the law has been approved, it will not take effect until October 1, 2026. Alabama follows Wyoming, which implemented a similar law in 2024, marking a growing trend among states to provide DAOs with a legal identity without conforming to traditional corporate structures.