Wyoming Bets Big on Crypto, Despite Market Volatility and Regulatory Uncertainty
The vast state of Wyoming remains one of the most crypto-friendly areas in America. Long regarded as a pioneer in the industry due to a wave of digital asset-friendly officials, Wyoming continues to make waves despite price uncertainty and the massive collapse of FTX.
Steven Lupien, director of the University of Wyoming-based Center for Blockchain and Digital Innovation, argued, “FTX would not have happened if it was a Wyoming company.” In late December 2022, Lupien told the AP how state agencies would have picked up on FTX’s “shenanigans.”
While others argued the scope of FTX would have been too much for state regulators to assess and handle, Wyoming leadership, and their boldness about crypto, has led to much innovation within the Equality State.
Lawmakers Busy With Pro-Crypto Policies
Lawmakers in Cheyenne have already passed more than 20 laws aiming to entice crypto businesses. For example, in February, the State House passed a bill prohibiting the forced disclosure of private keys by state courts unless information pertinent to a case is unavailable via ‘alternate means.’ Even more notably, the state legislature established a commission focused on developing a virtual currency backed by the U.S. Dollar for the state.
The Wyoming State Token Commission held its first meeting on May 8th to ask for feedback about deadlines, advisors, and what to watch out for regarding potential legal wrangling with federal officials. During testimony, several crypto industry figures speculated that a stable token could be a multi-billion dollar opportunity.
Governor Mark Gordon explained the intention was to see the project through but wanted to ensure “we meet the letter of the law.” As a result, the Governor agreed to let the Wyoming Stable Token Act become law in March without his signature, even though he thought the legislation lacked the “solid plan” needed for token issuance by the state.
Will Battles With Federal Officials
Stop Wyoming's Plans?
Federal officials have cast doubt on some of Wyoming’s crypto-focused plans in the past, which is why Wyoming’s plans for a stablecoin represent a new frontier.
In January, the Federal Reserve Board denied the application for the Cheyenne-based Custodia Bank, blocking the entity from becoming a Federal Reserve System member. Custodia has a crypto-focused banking model, and the Board expressed doubt at the time about their ability to thwart money laundering and terrorist financing with crypto.
In April, the State of Wyoming requested to join the case between the Federal Reserve System and Custodia Bank. Some see the court battle as a critical marker of how easy crypto-friendly institutions will find it to receive federal or state charters.
Local and state officials bolster Wyoming’s notoriety within the crypto space with a reputation as some of crypto’s strongest advocates.
State Offcials Continue To
Boldly Push For Crypto
Senator Cynthia Lummis is often regarded as the ‘Crypto Queen’ due to her strong support of Bitcoin. At the Bitcoin 2023 conference in Miami, she remarked how Bitcoin “is cleaning up the environment” since one could use vented methane gas from an oil and gas well to mine crypto.
In March 2023, Lummis and Senator Kristen Gillibrand of New York co-sponsored a revised version of legislation focused on defining crypto tokens and clarifying definitions related to potential crypto regulatory framework and oversight. However, uncertainty remains about how the legislation will fare upon review, as the Senate Banking Committee is led by Senator Sherrod Brown, a noted crypto skeptic.
In her Miami speech, Lummis explained how lawmakers in Washington did not have the insight to differentiate between Bitcoin and other cryptocurrencies, highlighting that “there are a lot of people in Washington D.C. that conflate companies with digital assets.”
Former Majority Whip of the Wyoming House, Tyler Lindholm, is also a noted crypto enthusiast. Now the state director for Americans for Prosperity, Lindholm wrote in April that “to date, approximately 500 decentralized autonomous organizations — a type of member-owned limited liability company (LLC) built on blockchain — have been established and 17,000 businesses with “crypto” in their name have been registered.”
What's The Way Forward For Wyoming?
The state looks to continue its efforts to be a leader in the Bitcoin, crypto, and blockchain spaces through legislative activity, business attraction, and advocacy endeavors. Market turbulence and uncertainty have clearly not slowed efforts.
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