On July 19, 2017, 45 out of 53 US jurisdictions that make up the Uniform Law Commission (ULC) voted to finalize and approve a draft of the proposed Uniform Regulation of Virtual Currency Businesses Act. The act only required the endorsement of 20 jurisdictions to progress forward.
The act seeks to establish a foundation for virtual currency businesses by providing individual states with a common regulatory guide for issues such as licensing requirements; reciprocity; consumer protection; cybersecurity; anti-money laundering; and supervision of licensees. Despite receiving scrutiny from the Bitcoin community due to legal uncertainties and suspected framework challenges, the majority of the commission finds the model law acceptable.
Among supporters is the virtual currency advocacy group Coin Center, which assisted the commission with the extensive two-year draft process. According to Peter Van Valkenburgh, director of research at Coin Center and one of more of the 50 observers who represent their respective views to the commission, the approval is the result of a hard pressed endeavor.
“We’re thrilled to see this pass the commission. I’ve been personally in the room at every one of the five drafting committee meetings that were publicly held all across the country over the last two years.”
“I’m also proud of several specific pieces of language in the act, because they closely mirror Coin Center’s frameworks and are the results of our advocacy, mixed with and meaningfully improved by, debates amongst the drafting committee members and the committee of the whole during this year’s annual meeting.”
Moving forward, Fred Miller, Chair of the Uniform Regulation of Virtual Currency Businesses Act, tells ETHNews that once the language of the model law is fine-tuned by ULC’s style committee, it will be presented to the House of Delegates of the American Bar Association (ABA) for approval. On this subject, Miller said, “We do not anticipate a problem there because one or more of the people that are drafting the act is an [ABA] advisor.”
If approved by the ABA, the model law moves forward to state legislators to be considered for state law, at which point, the associated state will have a comprehensive framework on exactly how to approach virtual currency businesses.