The U.S. Uniform Law Commission (ULC) is planning to undertake a review of existing model legislation to take account of the “emerging digital economy” and virtual assets like cryptocurrencies.
The body, which advises state legislatures on matters of unified legal form and drafting, urged states to put plans for crypto and blockchain legislation on hold until it had undertaken its work, suggesting existing model acts may be flawed.
This is a reflection of the decision of legislatures in states like Wyoming and Missouri to disregard ULC models in favor of their own legislation.
As part of the plans, the ULC intends to publish new unified rules on blockchain and cryptocurrencies, in order to provide more effective models for states to use when drafting their own state-level crypto laws and regulations.
In a statement published earlier this week, the ULC said states should refrain from legislating until the commission had considered any possible amendments to the Uniform Commercial Code.
It noted, “To meet the growing need for law on this topic, the ULC and ALI have created a study committee to determine how the Code [the UCC] might be amended on a uniform basis to deal with emerging technologies. States are urged to refrain from enacting legislation pending the result of the committee’s work.”
The announcement from the ULC is likely to impact on ongoing legislative processes in several states, including Nevada, California and Oklahoma, with each considered legislation based at least in part on ULC models.
However, it remains the case that to date, no state has chosen to write ULC crypto laws onto their statute books.
Under current legal structures, cryptocurrency laws differ from one state to the next, which has been identified by crypto entrepreneurs and commentators as a barrier to growth.
The ULC effort to codify universal standards in the UCC for crypto and blockchain seeks to bridge the gap by providing a coherent model of standards all states can implement.
Partner at New York law firm Kobre and Kim, Jake Chervinsky, said the ULC may run into challenges defining and classifying digital assets.
He tweeted: “It seems a common belief that digital assets can only fit a single category under US law–in other words, that they can be commodities OR securities OR property OR money OR speech, but not more than one…That’s wrong. Digital assets can be, and likely are, many of these at once.”
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