Is Texas Crypto Bill Good for Bitcoin Space? Not if you Stand for Financial Privacy & Autonomy
A new cryptocurrency related Texas bill is currently a hot topic of discussion which requires the checking for the payor’s identity by the payee accepting the payment in cryptos before the transaction goes through.
“Before accepting payment by a digital currency, a person must verify the identity of the person sending payment. A person is not required to verify the identity of a person sending payment if the payment is sent by a verified identity digital currency,” reads the official bill HB 4371 that was introduced in the Texas Legislature.
According to Coin Center, a non-profit research and advocacy center focused on the public policy issues facing cryptocurrency and decentralized computing technologies, this bill is not only counter to the Constitution and the basic rights of an individual but also prejudicial against new technologies.
“The bill would require individual citizens to spy on each other by forcing them to collect personal information from their transactional counterparts before accepting cryptocurrency payments.”
And should a Texan don't want to collect or provide the information, they are banned from using cryptocurrency.
In a normal scenario not involving cryptos, a warrant is required to search or seize information held by a party. While, HB 4371 forces all the individuals using cryptocurrency to investigate and hand over the information of each other and in the process, maybe forfeit a party’s expectations of privacy.
And this raises questions about the Fourth Amendment, as stated by Peter Van Valkenburgh in “Texas cryptocurrency bill threatens financial privacy.”
As mentioned above, the bill clearly states that it applies with certain types of cryptocurrencies only and not to physical cash transactions. Given the fact that cash is far more anonymous and preferable means of transacting than cryptos for criminal plots, it is prejudicial against new technology.
Moreover, the proposed language in HB 4371 is confusing as it talks about:
“verified identity digital currency” as “a digital currency that allows the true identities of the sender and the receiver to be known before a person has access to another person's digital wallet.”
The author argues that in cryptos, “wallet” is a service or application that an individual uses to store the private key of their crypto holdings and no one wishes to give anyone access to their wallet.
“Cryptocurrency, by contrast, embodies American values: freedom, self-sufficiency, and opportunity,” concludes Valkenburgh.