On 14 August, two American states introduced regulatory actions that targeted the crypto space. The first one was Maryland’s Attorney General that announced about the state taking part in Operation Cryptosweep, which is a joint initiative of provincial and state securities regulators in the U.S. and Canada. In Operation Cryptosweep, they will launch probes into potentially fraudulent or noncompliant crypto investment programs.
The other state was Nevada, and it unveiled new requirements for crypto ATM owners requesting them to get a transmission license. Business owners would have to pay as much as $10,000 for the first location granted by the license. The cost of every additional kiosk needs an extra $5,000. On the whole, bond requirements must not be higher than $250,000 in total.
Having spoken about these two states, let us now talk about the five notable U.S. states welcoming crypto regulations.
Five Most Crypto-Friendly American States
Some of the American states that have fair regulations in place for cryptocurrencies are:
As far as cryptocurrencies are concerned, Bitcoin seems to be on top of Colorado’s priority list. Colorado has started paving the way for the crypto industry. In May 2018, Senate Bill 086 was signed. This required the Department of State, the Governor’s Office of Information Technology (OIT), and the Department of Regulatory Agencies to consider using blockchain to protect confidential state records from theft and manipulation. It was in the same month that Wayne Williams, Colorado Secretary of State, made the proposal for allowing cryptocurrency donations to political campaigns, thus following the footsteps of the state of New Hampshire, which made this move in the year 2014.
In March 2019, The Colorado Digital Token Act was signed by the Colorado Governor. It is a bill that aims to exempt cryptocurrencies from certain securities regulations, like the legislation in Wyoming. Effective from 2 August, certain digital assets that were actually designed for ‘consumptive purpose’ will now qualify for securities exemptions. This bill will help Colorado’s state agencies regulate the Initial Coin Offerings (ICO) market, as the Colorado Division of Securities has been banning bad actors. Colorado has also blockchain to other fields. Before the Digital Token Act, in 2018, the mobile voting solution was deployed during the primary and midterm elections of West Virginia. In May 2019, the Governor of Colorado, signed the proposition for assembling an advisory group to study the application of blockchain in data verification and certification of organic products, product tracking, inventory management, and monitoring of in-field conditions.
Ohio still has a long way to go before it becomes a federal crypto hub in the U.S., but one can sense its ambitions as they are evident. Following the legal recognition of blockchain data in August 2018, lawmakers of the Buckeye State proposed using blockchain technology for marriage licenses and birth certificates and to work with universities so that they can offer blockchain-related courses to students.
Ohio has advanced greatly in one filed which is taxes paid in crypto. From November 2018, local companies have been paying everything right from cigarette sales taxes to employee withholding taxes using Bitcoin (BTC) after registering on the OhioCrypto.com website. Overstock.com was the first business to express interest in this option. Overstock is a pro-crypto e-commerce firm. The next domain in which Ohio might apply positive regulation is real estate. Earlier in 2019, the County Auditors’ Association of Ohio created a working group for studying the various ways in which blockchain could help to “more effectively” transfer real estate deeds at the state level.
This was the first state that published a memorandum to declare that no money transfer license would be required for selling Bitcoin or other digital currencies. But Texas cannot be given the credit of being the most crypto-friendly place as Texas was on the verge of passing a bill in early 2019 that would have resulted in a ban over the usage of cryptocurrencies between unidentified parties.
Blockchain lobbyist and the representative of the Wyoming House travelled to Texas’ capitol to meet the lawmakers and convince them about dropping this document, but could not meet the legislators. But much to the relief of Texas’ crypto enthusiasts, they did not proceed with this. Though positive regulation may not be its strong suit, it is still one of the most popular places for crypto mining in the U.S., in spite of its scorching hot climate. Last year, the town of Rockdale welcomed Bitmain’s plans of building the world’s largest mining facility while other states such as New York Tennessee were reluctant.
There are many crypto mining enterprises in the business-friendly state of Texas, like TMGCore. The cooling technology of TMGCore allows it to run mining rigs efficiently even during extreme summers. In other states such as New York and Washington, where mining is known to be cost-efficient, they have intentionally increased electricity costs for crypto businesses. Overall, this makes Texas a safer bet.
In 2014, California was one of the first states to bring about a form of crypto regulation as the Governor of California signed a bill that ensured that “various forms of alternative currency such as digital currency” are legal in transmitting payments and purchasing goods. Since then, California has not been at the forefront of cryptocurrency governance, but it is a popular destination for professionals working in the crypto industry.
Some of the biggest U.S. crypto companies such as Coinbase, Kraken, and Ripple are headquartered in California. The lack of certain regulations in California can be looked at as a blessing in disguise as local businesses are not hurdled with overly restrictive measures. California will soon be catching up with Wyoming and the other states. Earlier in August, California Government Operations Agency Secretary announced the chair and members of the blockchain working group that was created in 2018. According to the document, the task force must submit a report on the potential risks, benefits, and uses of blockchain to the state government by 1 July 2020.
Wyoming has always proved to be the undisputed leader in terms of crypto-friendly areas of America. The state of Wyoming put itself on the crypto map in 2018 a bill was passed by the Wyoming House of Representatives that defined utility tokens and exempted those of them that are not marketed as an investment opportunity from securities regulations.
There are currently seven other pro-crypto bills that remain active. These comprise details about granting digital currencies the same legal status as money. This will mean authorizing banks to hold digital assets in custody, creating a regulatory Fintech sandbox aimed at diminishing industry hurdles for blockchain startups, and helping corporations to tokenize their shares.
Wyoming, by authorizing banks to administer digital assets, helps them to comply with the Securities and Exchange Commission’s regulations for ‘qualified custodians.’ This will prompt even those who are not tech-savvy to enter the crypto market.
I hope you have now gained a fair understanding of some of the American states with crypto-friendly regulations. To enroll in blockchain certifications and become a blockchain expert, check out Blockchain Council.