Business 12 March 2019

Derek Tonin

Texas may demand identification for crypto payments

One of the biggest worries by those who don’t really understand blockchain technology is that cryptocurrencies can be used anonymously for criminal activity. In an effort to prevent that from happening, Texas will be considering a bill that will force businesses to ask for identification before accepting crypto payments.

The bill was put forward by Republican Phil Stephenson of the Texas House of Representatives, and it doesn’t establish how such a law would be enforced. It’s pretty short, establishing just the requirement of identification, and putting the responsibility of figuring the detailed requirements out on “the Texas Department of Banking, Credit Union Commission, Texas Department of Public Safety, and State Securities Board.”

The only exception to the rule is if the digital currency is a “verified identity digital currency,” which the bill describes as, “a digital currency that allows the true identities of the sender and the receiver to be known before a person has access to another person’s digital wallet.”

Again, it’s unclear what qualifies under that definition. If a user is aware of the address of crypto wallets before the transaction begins, does that count? Can this be done by information signed into the transaction? All unclear. If the bill becomes a law though, it will go into effect September 1, 2019, leaving the government not much time to figure this stuff out.

The hope would be that cooler heads could prevail in Texas, and some of the solutions put forward by Dr. Craig Wright, and specifically those of deterministic key generation and secure split key techniques, could lead to a solution that Texas is happy with. These techniques allow Bitcoin SV (BSV) to create a payment system that is more secure than what’s currently available, but also provides a better system of bookkeeping as well with the BSV blockchain.

That’s what this is really about in the end. The reason Texas wants identification is to prevent crime and corruption from taking over in the crypto space. BSV has the same agenda. It should be the perfect solution to the needs of the Lone Star state.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.

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