Cryptocurrencies have received official recognition in Texas after the adoption of two bills aimed at developing the cryptocurrency and blockchain industry.
Both bills numbered H.B. 4474 and H.B. 1576 officially entered into force on September 1 after they were passed by both houses of the state Legislature in May. The documents were signed by Governor Greg Abbott in June.
Bill 4474, which was introduced by Congressman Tan Parker in March, aims to define cryptocurrencies in the Unified Commercial Code of the state. According to Lee Bratcher, president of the Texas Blockchain Council, Bill 4474 defines a security interest for bitcoin and other cryptocurrencies and allows institutional investors to participate in large investments in digital assets.
Bill 1576 establishes a Texas blockchain working group to enact commercial law regarding blockchain innovation and regulation of digital assets. Now that the bills have come into force, there is legal clarity in the state for the definition of cryptocurrencies. The laws will provide a number of guidelines for Texas companies that want to enter the cryptocurrency business.
Texas banks have already received permission from the Texas Department of Banking to provide virtual currency storage services. The cryptocurrency-friendly approach of Texas is not surprising, since Governor Abbott is a supporter of cryptocurrency.
It is assumed that he stimulated the work of mining companies in Texas. Due to China’s crackdown on cryptomining, Texas has become home to cryptocurrency mining companies such as BlockCap and Riot Blockchain. Both companies plan to expand their mining facilities in the state by purchasing new equipment.
Texas has become another US state after Wyoming and Nebraska, which has recognized blockchain and cryptocurrency. Wyoming became the first cryptocurrency-friendly state by adopting the Digital Assets Act on February 26, 2019, which took effect on July 1, 2019. Since then, Wyoming has attracted various large firms, including Ripple.
In September last year, the Wyoming Banking Council approved Kraken’s activities as the first crypto bank. Kraken received the status of the first specialized depository institution in the state. Later, the banking council granted Avanti Financial the right to receive and store cryptocurrencies in the state.
In May of this year, Nebraska also approved a bill allowing state banks to provide cryptocurrency-related services to customers. Other states are ready to follow their example and adopt laws on cryptocurrency.
About 25 states are already considering blockchain and/or digital asset bills at their 2021 legislative sessions. Among them are Pennsylvania, South Carolina, Nevada, Kentucky and others.