Blockchain startups just got a boost. This is after the Wyoming House of Representatives unanimously approved the HB70 bill exempting utility tokens from security laws.
The blockchain startups will now enjoy a favorable environment and qualify as a utility token, also known as open blockchain token, only if they meet the three conditions as classified in the text of the bill.
First, the developer of the token must not market it as an investment.
Secondly, the blockchain startup must offer a product or service at the time of developing or issuing the tokens. This is to say that the token must be exchangeable for services and goods.
The third and final condition is that the token issuer or developer must not deliberately make efforts to find a secondary market for the token by locating buyers for it or agreeing to a purchase agreement.
Wyoming HB-70 Utility Token ICO Bill Significance
This is a landmark legislation for blockchain startups as it is geared towards blockchain advancement. This milestone will see a carve-out of space for tech companies actively involved in the creation and development of utility tokens.
The legislators passed the bill to exempt cryptocurrencies from state money transmission laws. The legislation also made an approval of the use of blockchain-based records for corporations. The HB 70 utility token bill provides legal procedures on how specific types of cryptographic tokens are accounted for.
The HB 70 utility token bill exempts several types of crypto assets from securities laws. The bill which was first passed by Wyoming’s House of Representatives on February 20th, 2018 now rockets ahead for signing by Governor Matt Mead.
In the meantime, four other blockchain bills have gone through Wyoming Legislature with HB 19, a Bitcoin-friendly bill, being passed by the House and now awaits introduction in the Senate.
The bills are quite favorable to crypto businesses and owners operating in the state.