Bitcoin Gains Legal Status in Texas As Crypto Bills Become Law
Cryptocurrencies have officially become recognized in Texas following the passing of two bills to push the crypto and blockchain industry.
Crypto Bills Took Effect On September 1
The two bills tagged H.B. 4474 and H.B. 1576 officially took effect on September 1 after being passed by both chambers in the state legislature in May. The bills were signed into law by Governor Greg Abbott in June.
In March, Bill 4474, which Representative Tan Parker introduced, aims to define cryptocurrencies in the state’s Uniform Commercial Code or UCC.
According to President of the Texas Blockchain Council, Lee Bratcher, Bill 4474 defines the security interests for Bitcoin and other cryptocurrencies and enables institutional investors to get involved with sizable investments.
On the other hand, bill 1576 establishes a blockchain working group in Texas to adopt commercial law to blockchain innovation and digital asset regulations.
With the bills now in effect, there is legal clarity in the state to define cryptocurrencies. The laws would come with a series of guidelines for Texas companies who want to participate in the cryptocurrency business.
State-chartered banks in Texas have already been given the go-ahead by the Texas Department of Banking to provide custody or safekeeping services for virtual currencies.
Texas' crypto-friendly nature comes as no surprise as Governor Abbott is a pro-crypto supporter. He also reportedly encouraged crypto mining firms to operate in Texas.
Due to China's crackdown on crypto mining, Texas is now home to crypto mining firms like BlockCap and Riot Blockchain. Both companies plan to expand their mining ventures in the state by purchasing new facilities and equipment.
Texas Follows Wyoming's Footsteps
Wyoming became the first crypto-friendly state when it passed its Digital Asset Law on February 26, 2019, and put into effect on July 1, 2019. Since then, Wyoming has attracted major firms, including Ripple.
Last September, the Wyoming State Banking Board approved Kraken to operate as its first crypto bank. Kraken was granted the first special-purpose depository institution (SPDI) charter in the state.
Similarly, the banking board granted a charter to Avanti Financial to receive and custody crypto in the state later that same year.
In May this year, Nebraska also approved a bill allowing banks in the state to offer cryptocurrency services to customers.
More states are poised to follow suit in rolling out crypto laws soon. About 25 states are already considering blockchain and/or digital asset-related laws in their 2021 legislative sessions. This is according to the National Conference Of States Legislatures. Some of them include Pennsylvania, South Carolina, Nevada, Kentucky, and others.