(HB1796)

GOVERNOR'S VETO

Pursuant to Article V, Section 6 of the Constitution of Virginia, I veto House Bill 1796, which creates a regulatory framework for decentralized autonomous organizations (DAOs) in Virginia.

DAOs—blockchain-based entities governed by self-executing code—lack the legal safeguards, fiduciary standards, and transparency expected of business entities operating in the Commonwealth. Their decentralized nature and absence of physical presence make enforcement difficult and have already drawn federal scrutiny for fraud, the sale of unregistered securities, and other abuses.

While emerging technologies deserve thoughtful consideration, prematurely recognizing this structure in Virginia law would expose the Commonwealth and its citizens to unnecessary risk. In the coming weeks, I will be asking the Secretary of Finance to convene a stakeholder group with representatives from corporate finance, banking, the Virginia State Bar, the Office of the Attorney General, among others, to conduct a comprehensive study of DAOs and provide recommendations by December 1, 2025.

Accordingly, I veto this bill.