After much deliberation and suspicion, most US states now have a firm opinion about bitcoin use within their territory. However, they look divided in their view on cryptocurrencies. States are positive on the use of blockchain technology and have at least some kind of regulatory policy at work. A new report by Brookings Institution titled “Blockchain and US State Governments: An Initial Assessment” shows the general trends towards cryptos in different states.
State governments in the US are at different stages of regulatory policy implementation regarding blockchain technology and cryptocurrencies. Some states still fall behind in this procedure but most believe that these new technologies could be leveraged to improve public services and boost local economies.
More specifically, there are two waves of crypto-related regulatory policies that can be identified amongst the state governments. The first wave started in 2014, when 20 states adopted legislations to regulate the cryptocurrency market. During this time, New Mexico and California were among the 10 states that warned against investing in digital currencies.
The second wave started in 2016, when most states started showing interest in the implementation of blockchains in the public sector. The authorities were convinced that this breakthrough technology can be used to make public services more easily accessible and less wasteful.
The report classifies different US states into seven categories, namely Unaware, Reactionary, Appreciative, Organized, Actively Engaged, and Recognizing Innovation Potential.
The unaware states include the likes of South Dakota and Arkansas which have remained completely oblivious of the crypto regulations till date. Though the public is engaged in crypto trading, the authorities have not taken many steps to regulate the market. Reactionary states are those that have taken a negative stance, including Texas, Iowa and Indiana.
Appreciative states are welcoming digital coins and include the likes of North Dakota. Organized states like New Hampshire and Washington have already passed laws and regulate their respective ecosystems. Active engagement states like Vermont are considering blockchain in governmental systems.
The most important are classified in the last category- Recognizing Innovation Potential. Arizona and Delaware are listed in this category as they have the potential to completely redefine the crypto industry. Delaware hosts offices of several Fortune 500 companies which will likely be innovating in blockchain technology soon.
States like Wyoming are now considering the use of this technology for boosting their economy. The state recently exempted its citizens from paying property tax on their bitcoin holdings. In the process, Wyoming has become the most crypto-friendly states in the US. On the other hand, Colorado, which has been very cautious of this technology for some time, is now adopting a bipartisan bill that will help the government use blockchains for record keeping.
Arizona has gone one step ahead of the others, promising to start accepting state taxes in cryptocurrency. In fact, many more crypto bills are pending in the state legislature. Georgia is also following Arizona’s footsteps and it May likely start accepting tax payments in digital coins too. It will be interesting to note how these states continue with their regulations and accommodate new digital assets in their laws.