• Wyoming Senator Wants Wyoming to Set a Cryptocurrency Example

  • Senator Cynthia Lummis of Wyoming is attempting to encourage her colleagues in Congress to follow her state’s lead in regulating cryptocurrencies.

    Wyoming is in the vanguard of regulating the burgeoning digital asset sector, having passed a flurry of crypto-friendly legislation in 2018 and 2019. For example, the state has enacted legislation exempting digital currencies from property taxation, as well as harmonizing regulatory wording. This prompted numerous well-known companies, like cryptocurrency exchange Kraken and blockchain platform Cardano, to relocate their operations there.

    Furthermore, Wyoming has pushed cryptocurrency miners to power the energy-intensive operation with natural gas, an unwelcome byproduct of drilling. In Wyoming, these advances resulted in the establishment of special purpose depository institutions, or SPDI (“speedy”) banks, in 2019. These were the first fully regulated financial institutions in the United States to accept cryptocurrencies alongside fiat cash.

    “Cryptocurrency provides an alternate store of value as well as the technology that diversifies our economy for a state like Wyoming,” said Wyoming state senator Chris Rothfuss, who also chairs the chamber’s blockchain committee. “We needed to produce something that wasn’t dependent on coal, oil, and gas—those were dwindling industries.”

    Crypto objectives

    Wyoming, Lummis says, could serve as a model for federal regulation of the $1.6 trillion bitcoin sector. She stated that the state had “so effectively innovated in this regulatory and legislative domain that it was ready for prime time, in a huge manner.”

    Despite critics’ claims that bitcoin enables cybercrime, Lummis claims that cryptocurrency can sometimes be more traceable than cash. She hopes to pass legislation that will create a digital asset working group that will include federal regulators. This would presumably include representatives from the SEC and the CFTC.

    Lummis envisions a more thorough regulatory framework for cryptocurrencies in the next three to four years. She thinks that this will eventually lead to more institutions accepting Bitcoin as legal money.

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