A new bill filed in the Alabama Legislature will start a conversation on the use of the growing markets surrounding cryptocurrency and other blockchain technologies.
In the early days of crypto and crypto fraud, Alabama was one of the first states to crack down on less-than-legitimate companies and trading platforms. In 2018, the Alabama Securities Commission shut down at least nine companies advertising in Alabama.
While cryptocurrency and other digital assets are not quite the Wild West they were in the early years, many states are still figuring out how to deal with the changing landscape and how states can take advantage of the evolving market.
Enter State Rep. Mike Shaw (R-Hoover), whose recent bill would prohibit the state from restricting the use or storage of digital assets, levying additional taxes on digital assets, restricting digital asset mining, or enacting zoning restrictions or noise restrictions specific to digital asset mining.
House Bill 214 (HB214) addresses several aspects of digital asset use and collection, including mining, its use as currency, taxation and zoning restrictions. It will also define terms and possibly exempt digital asset mining, staking, and node operation from classification as a security or money transmission.
Shaw told 1819 News that while the bill is already subject to several amendments that will come in a substitute, he expects the bill to bolster the conversation for the future of crypto and blockchain assets in the state.
"This just sets up a basic framework," Shaw said. "We're already putting together a significant substitute based on a lot of input. This touches on a lot of different fronts. It touches on power regulation, land use regulation, securities regulation, so a lot of people have input and a lot of things to say."
Shaw has worked extensively in the technology field for decades in cyber security. He was also appointed to Gov. Kay Ivey's newly formed artificial intelligence task force and the only state lawmaker with a CISSP (Certified Information Systems Security Professional) certification.
"It's a newer technology, and sometimes people are afraid of what they don't understand. But in this case, I've found there are a lot of reasonable concerns by the different agencies, and I think it will take time to work through those things. Crypto has some great things. A lot of people associate it only with Bitcoin or NFTs, but there are a lot of opportunities for blockchain and smart contracts and how you transfer contracts back and forth. I've even heard cases made for using it for tracking land records, transferring titles, and things like that. So there's a lot of opportunity. We're still really early in the life cycle of that technology. And there's a lot of opportunity for the state with new businesses and whole entire industries."
"I think there's a lot of opportunities for our state, both in businesses and for individuals. We want to set up a framework for how blockchain can exist in our state that both takes everybody's concerns into consideration and also promotes blockchain as a technology," he continued.
While Shaw recognizes the concerns and interests of different agencies in the state, he believes addressing concerns will require something other than a specific regulatory agency or body while still addressing the potential pitfalls that come with the growing technology.
Related: Alabama, 9 states issue show cause order to crypto exchange Coinbase.
"I think the priority will be clarifying how blockchain technology fits into our existing regulation," Shaw continued. "The [Alabama Securities Commission] has an important job. They're trying to protect people and make sure everybody has a level playing field, and I certainly would not want to get in the way of that. I think there's still a lot of legal issues to be worked out with some things related to blockchain."
He continued, "Some of the wallets have lost a lot of money for a lot of people. We also don't want crypto to be used in enabling criminal behavior. We want people to see it for what it can be in a positive way. These are all the questions that we're going to work out. There's not going to be any rush. We're going to take our time with it and make sure we do it right."
To connect with the author of this story or to comment, email craig.monger@1819news.com.
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