Committee hears supporters and critics of new legal framework for decentralized nonprofit associations

Senator Parker laid out House Bill 45,18 to create a legal regime for decentralized, unincorporated nonprofit associations (DUNAs), a vehicle used by blockchain projects and web‑3 communities to organize and govern via smart contracts and distributed governance.

Sponsor testimony described DUNAs as organizations that can hold property, enter contracts and provide limited liability to participants while using blockchain‑based governance. Parker said the bill is modeled on existing unincorporated nonprofit association statutes and similar laws enacted in other states such as Wyoming.

Supporters, including David Kerr of Cowry (a legal and tax adviser for blockchain projects) and other industry witnesses, argued the statute will permit projects to domicile in the U.S. rather than overseas and would provide a clear, limited legal framework tailored to protocol and decentralized governance structures.

Opponents included John Ale, former chair of the Business Law Section of the State Bar of Texas, who warned the bill permits entities to form without mandatory filings, member lists, or an agent for service of process and could be used anonymously by foreign actors. Ale said existing structures (LLCs, corporations, or current unincorporated association law) already provide ways to accomplish the same goals with stronger safeguards.

The committee heard both sides and left the bill pending.

Actions

Public hearing; no committee vote recorded. Outcome: left pending.

Why it matters

Creating a statutory home for DUNAs could make Texas attractive to blockchain nonprofit projects and protocols by providing legal certainty, but critics warned about limited transparency and potential anonymity risks.