California might be inching closer to embracing the future. In a bill that is making its way through the state legislature, hopes are high that blockchain will be accepted as a legal means of corporate documentation. It’s a small step, but a step all the same.
The bill was introduced by Senator Bob Hertzberg. The Democrat represents the San Fernando Valley area, and authored Senate Bill 838 which was presented to the Senate Banking and Financial Institutions Committee. Hertzberg explained of the bill, “The world around us is changing, and government must adapt with these rapidly evolving times. California needs to continue our legacy of taking on new and developing technologies, especially ones like blockchain, which is being embraced worldwide and presents a strong level of security that is resistant to hacking.”
SB 838 governs the use of blockchain specifically for formal corporate documentation. It would allow blockchain to be used in a corporation’s articles of incorporation, and would be an initiation of the decentralized technology into California. It would introduce “cryptography-fueled security” into corporate share certificates that would subsequently be stored on the blockchain.
Aside from being used for issuing or transferring the certificates, the names of the corporate stockholders, addresses and number of shares registered to each of these stockholders would also be recorded on the blockchain.
Hertzberg is a strong proponent of blockchain technology, and is using his knowledge to win over other lawmakers. He educates them on fintech solutions, the myriad of uses for blockchain beyond cryptocurrencies, and pushes for a greater acceptance of the technology across the state. The bill goes before the Senate Judiciary Committee in May.
If passed, the bill would push California into the company of other forward-thinking states. Nevada became the first to adopt new policies, outlawing tax collection on blockchain use in the summer of 2017. Arizona has also joined in, passing legislation at the beginning of this month that allows blockchains to be used for record-keeping and could be the first to allow the use of cryptocurrency for paying taxes. Wyoming and Colorado are thought to also be exploring blockchain legislation.