State legislatures are making significant strides in crypto regulation, with over 30 bills passed in 2024. Discover how this momentum is setting the stage for the upcoming elections and the future of digital assets in the U.S.
As Congress grapples with cryptocurrency regulations, state legislators are quietly making substantial progress, pushing forward a raft of measures that reflect a growing consensus on the need for clear and consistent digital asset regulation. With the summer recess in full swing, this momentum shows no signs of slowing down, and it could significantly influence both congressional and down-ballot races this fall.
A Surge in State-Level Crypto Legislation
So far in 2024, over 30 bills impacting digital assets have been enacted at the state level, more than doubling the number passed last year. This surge is evident in both Republican and Democratic states, showcasing a broad, bipartisan appetite for robust crypto regulation. States are recognizing the importance of taking action ahead of the November elections, where these efforts could become a focal point for voters.
June: A Busy Month for Crypto Policy in New England
June has been particularly active for state crypto policy in New England, a region home to key races and a variety of significant bills. These legislative efforts have addressed crucial areas such as custody requirements, self-hosted wallets, unclaimed property, crypto mining, and central bank digital currencies (CBDCs).
New Hampshire's Regulatory Expansion
In the swing state of New Hampshire, which has seen alternating majorities between Democrats and Republicans since 2006, legislators have worked to expand the regulatory framework to include certain digital asset activities. In June, the state legislature negotiated differences between the House and Senate versions of HB 1241, a bill extending money-transmitter laws to encompass "virtual currency" transmission.
Maine's Digital Asset Update
Maine, another potential swing state in the 2024 election, advanced updates to its Money Transmitter License (MTL) regulations concerning digital assets. However, the bill, signed into law by Governor Janet Mills as LD 2112, included provisions that could hinder the functionality of self-hosted wallets. Policymakers will need to address these issues during the implementation process to avoid stifling the digital asset ecosystem.
Massachusetts: Modernizing Digital Asset Management
Senator Elizabeth Warren's home state of Massachusetts is also making strides in crypto legislation. House Bill 1641 aims to modernize how fiduciaries manage digital assets, aligning with similar legislation in states like Oklahoma and California. The Joint Judiciary Committee, comprising members from both the state House and Senate, has recommended the bill for further study.
On the local level, the city of Quincy, just south of Boston, issued the first municipal blockchain-based bond for $10 million with J.P. Morgan. This move highlights the benefits of blockchain technology in reducing costs, enhancing liquidity, and shortening settlement times in debt markets. Given Warren's vocal stance on federal crypto policy, developments in Massachusetts warrant close attention.
Rhode Island and Louisiana's Legislative Advances
In June, Rhode Island's Governor Dan McKee signed SB 2803 into law. The bill sets minimum capital requirements and limits on investments for "currency transmitters," including crypto exchanges. Similarly, Louisiana's HB 488, signed by Governor Jeff Landry, encourages Bitcoin mining and prohibits CBDCs, reflecting bipartisan support for state rights in crypto policy.
North Carolina's Anti-CBDC Legislation
A significant win for crypto advocates came on June 27, when North Carolina's HB 690 passed the state Senate. The bill, now awaiting the governor's consideration, prohibits CBDC payments and the state's participation in Federal Reserve CBDC tests.
Implications for the November Elections
The steady growth of state-level legislative activity signals that policymakers are listening to their constituents, with significant implications for the upcoming November elections. Over 50 million Americans own crypto, and in swing states with tight races, these crypto-savvy voters could make a decisive impact.
These voters understand that the U.S. is at a critical juncture regarding leadership in the Web3 space and do not want to cede ground to global competitors. Candidates who support clear regulatory frameworks and the advancement of digital technologies could gain an edge in tight races across the country. June's state-level activity proves that policy leadership on crypto can emerge from any part of the nation and from either side of the political aisle.
As state legislatures continue to shape the regulatory landscape for digital assets, they provide much-needed clarity and security for businesses and consumers. The bipartisan efforts across the country underscore a shared recognition of the importance of digital assets in the future economy. The developments in June highlight the dynamic nature of crypto policy at the state level, setting the stage for significant electoral implications in November.
At OMGfin, we stay at the forefront of crypto legislation and its impacts. Join us as we delve into the latest state-level developments and their implications for the crypto community. Stay informed and engaged with us as we navigate the evolving landscape of digital assets.
(PETER HERZOG, COINTELEGRAPH, 2024)