Blockchain acceptance across U.S. states
With the cryptocurrency market skyrocketing terms of valuation and back on track to be a trillion dollar industry, the world has finally started paying attention to the underlying technology that powers it, commonly known as blockchain.
Originally introduced purely as a transaction ledger for bitcoin by Satoshi Nakamoto in 2009, its use has since evolved beyond cryptocurrency applications. Its affiliation with digital currencies, however, has resulted in local jurisdictions in the United States being slow to regulate it.
Blockchain use in U.S. states
One of the first states in the U.S. to pass a pro-blockchain law was Delaware in 2016 with the Delaware Blockchain Initiative. Introduced by Governor Jack Markell, it was meant to ensure that “Delaware’s regulatory environment is welcoming and enabling by observing the industry as it develops further, rather than immediately enacting laws and regulations regarding licensing of blockchain companies.”
Given that several Fortune 500 companies are based in the state, it was considered to be a major turning point for the industry.
The following year also saw Illinois announce its own Blockchain Initiative in a bid to boost innovation in distributed ledger technology and encourage business in the region. The initiative also specifically mentioned blockchain-based applications for government-related services to boost transparency and trust among other similar advancements.
The most blockchain and crypto state, however, is neither Delaware nor Illinois, but Wyoming. In February 2018, the state passed legislation that not only allowed the free trade of cryptocurrencies but also made initial coin offerings legal and earnings from digital tokens exempt from property taxes. Businesses were also given the right to legally use blockchains for company records. With these laws, it is clear that Wyoming hopes to become a regulatory example for the cryptocurrency industry.
States apprehensive of blockchain technology
However, while most U.S. states have acknowledged blockchain-based developments, there are still a few that are either apprehensive or unaware of the industry.
According to a study conducted by Brookings Institute that classified states based on their engagement with blockchain, Arkansas, and South Dakota, for instance, have taken no stand on the topic, while Indiana, Iowa, and Texas have chosen to take a critical stance.
Not all states that allow blockchain and cryptocurrency business are preferred by new startups though. New York State’s BitLicense, for example, is a prime example of how restrictive regulation ended up turning away even existing companies operating in the region.
Introduced by the New York State Department of Financial Services in 2015, it spurred a mass exodus of cryptocurrency-related businesses, including Bitfinex and LocalBitcoins. Three years later though, New York legislators are finally open to re-evaluating the controversial law.
Even though the prolific cryptocurrency ecosystem has been attracting as much criticism as praise of late, the universal consensus that blockchain technology is receiving for its sheer groundbreaking nature is a telling tale of how technically capable it truly is. Nevertheless, with several test pilots scheduled to occur within the next couple of years, it is likely that blockchain is here to stay after all.