The Texas House of Representatives has passed a bill that seeks to officially give digital currencies a legal status. Known as the Virtual Currency Bill, it will introduce virtual currencies into the state’s Uniform Commercial Code (UCC) which governs commercial transactions in Texas.
The bill was first proposed on March 12 by Representative Tan Parker as an amendment to the UCC. At the time, many legal experts observed that the bill was quite similar to the ‘Digital Asset Bill’ through which the state of Wyoming is quickly establishing itself as a blockchain and digital currencies hub in the U.S.
The Virtual Currency Bill immediately received the support of many in Texas and beyond. One of them was the Texas governor, Greg Abott. “Count me in as a crypto law supporter. […] Texas should lead on this like we did with a gold depository,” he stated.
Count me in as a crypto law proposal supporter.
It is increasingly being used for transactions and is beginning to go mainstream as an investment. (Fidelity, etc. trying to get Bitcoin ETF).
Texas should lead on this like we did with a gold depository. https://t.co/1z25mtgnmu
— Greg Abbott (@GregAbbott_TX) March 29, 2021
The governor may be signing this bill into law soon. Having been passed unanimously in the lower house, it will now proceed to the state Senate where it may be due for some amendments. The Senate will then vote on it and if it passes this stage, it will be tabled to the governor to be signed into law.
The bill defines virtual currency as “a digital representation of value that functions as a medium of exchange, unit of account, and/or store of value and is often secured using blockchain technology.”
It then goes on to define the rights that a digital currency holder shall have, including the state’s protection of his/her right to own the digital currency.
If the bill is signed into law, it takes effect on September 1, 2021.
The Lone Star Bitcoin state
The bill has continued to receive plaudits from industry leaders who believe it’s a step in the right direction for Texas. Caitlin Long, a member of the Wyoming Blockchain Task Force and co-founder of digital currency custodian Avanti Financial Group, remarked, “That’s a huge positive, because in most U.S. states, the legal status of Bitcoin is unclear, which means that judges have no roadmap to adjudicate disputes, and parties do not have clarity regarding their rights and obligations.”
While the new bill aims to foster digital currency adoption, Texas is currently better known for hosting a number of large mining farms. They include Riot Blockchain which recently acquired a data center in Texas for $650 million. Argo Blockchain is also setting up operations in West Texas.
Block reward miners have cited the low power costs as the reason they chose Texas. Peter Wall, the Argo Blockchain CEO remarked, “We chose West Texas and this site in particular because it offers us some of the lowest electricity rates in the world and the majority is from renewable sources, namely wind and solar.”
See also: CoinGeek Live panel on Regulation of Digital Assets & Digital Asset Businesses
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