Over the last several weeks, the Wyoming legislature has passed five bills related to blockchain and cryptocurrencies. ETHNews provides a brief overview of each piece of legislation.
House Bill (HB) No. 19 – The Wyoming Money Transmitter Act-virtual currency exemption.
If and when Governor Matt Mead signs HB19, virtual currencies would immediately become exempt from Wyoming's money transmitter laws, which would pave the way for virtual currency exchanges to resume operations in the state.
Coinbase suspended its Wyoming operations in June 2016. At the time, the exchange stated that maintaining "dedicated fiat currency reserves in amount equal to the aggregate face value of all funds held on behalf of customers" would be "impractical, costly, and inefficient."
HB19 defines virtual currency as "any type of digital representation of value that: (A) is used as a medium of exchange, unit of account or store of value; and (B) is not recognized as legal tender by the United States government."
- On February 19, 2018, the Wyoming House unanimously passed HB19.
- On March 2, 2018, the Wyoming Senate passed the bill with a vote of 28-2.
HB No. 70 – Open blockchain tokens-exemptions (a.k.a. the "Utility Token" bill).
The "Utility Token" bill, HB70, also awaits the signature of Governor Mead. If he approves the bill, certain digital assets would immediately be exempted from Wyoming's securities laws.
Basically, there are three types of blockchain-based tokens.
First, there are convertible virtual currencies, like bitcoin, which have been defined as commodities by the Commodity Futures Trading Commission (CFTC).
Second, there are tokens that are marketed and treated as investment opportunities, similar to stocks. These are frequently sold through initial coin offerings (ICOs) and typically trade on secondary markets.
Third, there are tokens that are "utility tokens," meaning that they are made available by a person or group who provides or creates the platform to offer some good or service.
Wyoming's legislature is trying to carve out an exemption for the third variety – these "utility tokens" – which might encourage blockchain-oriented business development in the state.
- On February 19, 2018, the Wyoming House unanimously passed HB70.
- On March 6, 2018, the Wyoming Senate passed the bill with a vote of 27-3.
- On March 7, 2018, the Wyoming House received HB70 for concurrence and unanimously passed it once again.
HB No. 101 – Electronic corporate records (a.k.a. "The Blockchain Records Bill")
HB101 proposes to modify Wyoming's Business Corporations Act to allow for blockchain-based records storage, shareholder management, and shareholder votes. It is strikingly reminiscent of Delaware's Distributed Ledger Shares Bill (SB69), which was signed into law in July 2017. For now, HB101 also awaits Governor Mead's signature, per Open States.
- On February 20, 2018, the Wyoming House unanimously passed HB101.
- On March 5, 2018, the Wyoming Senate unanimously passed HB101. That same day, the Wyoming House received the bill for concurrence.
- On March 6, 2018, the Wyoming House unanimously passed HB101 once again.
HB No. 126 – Limited liability companies-series.
HB126 would allow limited liability companies (LLCs) to "establish series of members, managers, transferable interests or assets as specified; specifying powers; providing for limitations on liabilities; providing for management, termination and dissolution; authorizing distributions to members; imposing a requirement on foreign limited liability companies that establish series; requiring rulemaking; and providing for effective dates." The bill has not yet been signed by the Wyoming Governor.
Some have suggested that HB126 would be useful for those interested in developing decentralized governance protocols, while others have said that the bill would be useful to people (or companies) who wish to minimize the legal risks that might be associated with token ownership.
- On February 20, 2018, the Wyoming House passed HB126 by a vote of 57-3.
- On March 5, 2018, the Wyoming Senate passed HB126 by a vote of 28-2. That same day, the bill was sent to the House for concurrence.
- On March 6, 2018, the Wyoming House unanimously passed HB126.
Senate File (SF) No. 111 – Property taxation-digital currencies (a.k.a. "The Cryptocurrency Property Tax Exemption Bill").
As one might guess from the bill's title, SF111 would amend the Wyoming Statutes to create a property tax exemption for cryptocurrencies, like the exemptions that exist for cash, gold, and silver. Even if cryptocurrencies are exempt from Wyoming's state taxes, this does not mean that they will be exempt from federal taxes – as convertible virtual currencies have been defined as property by the Internal Revenue Service (IRS).
SF111 awaits Governor Mead's signature.
- On February 27, 2018, the Wyoming Senate unanimously passed SF 111.
- On March 7, 2018, the Wyoming House unanimously passed SF 111.