Could a Decentralized Autonomous Organization (DAO) Governing a Stablecoin Be Held Legally Liable for AML/KYC Failures?

The legal liability of DAOs is a developing and uncertain area of law. Regulators may attempt to hold a DAO liable by treating it as a general partnership, making its token holders jointly and severally liable.

Alternatively, they could target identifiable actors such as core developers, major governance token holders, or operators of front-end interfaces. For a stablecoin DAO, failure to implement transaction monitoring or controls could be seen as willful negligence, creating significant legal risk for its participants, especially if the DAO profits from transaction fees.