Bill SF0125 passed its second and third Senate readings on February 13th and 14th respectively, was endorsed by governor Mark Gordon thereafter and became law on February 15th.
The legislation allows Wyoming residents to own cryptocurrency tokens with complete legal protection, instead of only being protected through third-party storage. With that, Wyoming became the first US state to pass laws empowering private ownership of cryptocurrency.
It’s Wyoming’s goal for legislative change to spark a chain reaction of interest from consumers, businesses and investors. Blockchain companies will likely want to apply Wyoming law to their contracts and either incorporate or create their headquarters in Wyoming. In turn, the registration and incorporation fees will increase revenue in Wyoming, boost the economy and hopefully (for Wyoming) make Wyoming the crypto-capital of the United States.
In the United States, state legislators control property rights within their respective states, which creates a patchwork landscape as different jurisdictions have different policies regarding property. This regulatory irregularity combined with the aggressive pursuing of securities laws violations by federal regulators has made incorporating in the US a daunting prospect for many blockchain businesses. Wyoming aims to make its state a safe place for global interests looking to incorporate in the United States.
In fact, there are some forecasts claiming that there will be a shift of preference among market participants from New York to Wyoming because Wyoming is now viewed as more protective of property rights and investors than New York. In fact, a Wyoming-based blockchain advocate recently tweeted: “Have fun watching the transfer of capital away from NY (and) into WY in the coming years, (especially) as securities are increasingly issued on (blockchains.)” @CaitlinLong_
And that’s not all.
The Wyoming House of Representatives also passed two other crypto bills on February 15th: House Bill (HB) 0074 and HB0185, both focused on legitimizing cryptocurrencies as an asset class.
HB0185 would enable securities to be issued in tokenized form. If stockholders want to use a blockchain token to represent a stock certificate, with HB0185, that would be a legally issued security. Therefore, this bill legitimizes the migration of legacy securities on chain.
HB0074 aims to address one of the major challenges to the blockchain industry: banks. In fall 2017, many banks did a compliance review that resulted in them closing every account that was connected to digital assets. Many blockchain businesses lost their bank accounts and were forced out of businesses. BB0074 creates specially tailored depository institutions to serve businesses, such as blockchain companies, which may not be able to access traditional banking services.
Wyoming is quickly becoming the epicenter of American crypto regulation and setting an example for other states, and countries, to follow.