{"id":210660,"date":"2021-03-25T17:00:52","date_gmt":"2021-03-25T14:00:52","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain\/"},"modified":"2021-03-25T17:00:52","modified_gmt":"2021-03-25T14:00:52","slug":"texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain\/","title":{"rendered":"# Texas chases after Wyoming with crypto law proposal, but challenges remain"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a5056ca796be\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a5056ca796be\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain\/#Texas_aims_to_rank_second_to_Wyoming_but_concerns_remain\" >Texas aims to rank second to Wyoming, but concerns remain<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain\/#Texas_remains_positive_despite_concerns\" >Texas remains positive despite concerns<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Texas chases after Wyoming with crypto law proposal, but challenges remain <\/strong>&#8221;<br \/>\n<img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDMvYzNkNzhmZWMtNTZiMC00OTQ2LTk5YWMtNDZhMGRjNTEzZDVkLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-5a136f3a>Everything is bigger in Texas, but when it comes to crypto-friendly legislation, this doesn\u2019t seem to be the case\u2026 just yet. On March 12, 2021, Texas Representative Tan Parker introduced the Uniform Commercial Code, also known as UCC, amendment bill (<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/capitol.texas.gov\/tlodocs\/87R\/billtext\/pdf\/HB04474I.pdf#navpanes=0\">House Bill 4474<\/a>) to better adapt commercial law to blockchain innovation and digital asset regulations. <\/p>\n<p>Specifically speaking, the Texas UCC amendment bill aims to recognize virtual currencies under commercial law. Lee Bratcher, president of the Texas Blockchain Council \u2014 an organization recently established as a trade association intended to make Texas a leader in national blockchain growth \u2014 told Cointelegraph that the Texas Blockchain Council worked closely with Texas legislators to draft this bill, noting that if passed, it would change the business law around the definition of digital currencies and the legal definition of control:<\/p>\n<blockquote><p>\u201cThe Texas Blockchain Council has been working with uniform law commission around the language of the UCC amendment bill, along with other stakeholders to make sure they are all comfortable with the language.\u201d<\/p><\/blockquote>\n<h2><span class=\"ez-toc-section\" id=\"Texas_aims_to_rank_second_to_Wyoming_but_concerns_remain\"><\/span>Texas aims to rank second to Wyoming, but concerns remain<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>According to Bratcher, HB 4474 is similar to what Wyoming is already doing with its\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wyoleg.gov\/Legislation\/2019\/sf0125\">Digital Asset Law<\/a>, which was passed on Feb. 26, 2019, and put into effect on July 1, 2019. \u201cIf the UCC amendment Bill passes, Texas would solidify a leadership position alongside states like Wyoming that have already blazed a trail towards regulatory clarity,\u201d commented Bratcher.<\/p>\n<p>While notable, a few unaddressed challenges remain. Caitlin Long, chief operating officer and founder of Avanti Financial Group \u2014 a Wyoming bank formed to serve as a bridge between digital assets and the U.S. dollar payments system \u2014 told Cointelegraph that HB 4474 is similar to Wyoming\u2019s law in one respect: It aims to define virtual currencies. Long stated:<\/p>\n<blockquote><p>\u201cThat\u2019s a huge positive, because in most U.S. states, the legal status of Bitcoin is unclear, which means that judges have no roadmap to adjudicate disputes, and parties do not have clarity regarding their rights and obligations.\u201d<\/p><\/blockquote>\n<p>Long further noted that if HB 4474 passes, then Texas will join Wyoming as the only U.S. state to clarify this critical area of the law. \u201cBoth the Texas and Wyoming laws do so in the right way, which is to recognize control of the virtual currency as the determining factor,\u201d Long remarked.<\/p>\n<p>However, Long pointed out a critical gaping hole in HB 4474. According to Long, the bill does not define how a lender can establish an enforceable lien on a virtual currency. \u201cIn the legal parlance, this is called, \u2018how to perfect a security interest,\u2019\u201d she commented. <\/p>\n<p>Long explained that she is worried that Bitcoin (BTC) owners will become \u201cmired in a lien mess in the U.S.\u201d because U.S. commercial law doesn\u2019t clarify which liens on Bitcoin are enforceable. This has become even more worrisome for Long, as she pointed out that there has been a huge rise in lending secured by Bitcoin as collateral in recent years: <\/p>\n<blockquote><p>\u201cI think a lien mess is already building in Bitcoin. Bitcoin owners are at risk of being hit with old, unknown liens on their coins, which they had no way of discovering before purchasing \u2014 and the higher the Bitcoin price goes, the greater the financial incentive that lawyers have to pursue such claims.\u201d <\/p><\/blockquote>\n<p>Unlike HB 4474, Long noted that the Wyoming <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wyoleg.gov\/Legislation\/2019\/sf0125\">law<\/a> clearly states how lenders can create an enforceable lien on Bitcoin while also providing for the cleansing of dormant liens. Unfortunately, HB 4474 has not done this just yet. Rather, HB 4474 clarifies that an innocent purchaser won\u2019t be subject to such adverse claims, adhering to the \u201ctake free\u201d <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/uk.practicallaw.thomsonreuters.com\/w-013-3533?transitionType=Default&amp;contextData=(sc.Default)&amp;firstPage=true\">rules<\/a>. <\/p>\n<p>Although this is the case, Long pointed out yet another concern, further questioning what would h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>en to valid liens that were in force before HB 4474 potentially becomes a law. \u201cWould Bitcoin lenders no longer have a valid lien in Texas? And will this affect the willingness of Bitcoin lenders to lend to Texas customers?\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Texas_remains_positive_despite_concerns\"><\/span>Texas remains positive despite concerns<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Although some critical concerns remain regarding HB 4474, Bratcher remarked that more guidance will eventually be formed around the UCC amendment bill: \u201cWe are working to produce a framework that moves in the same direction of Wyoming, and we will be following up with additional legislation in the future.\u201d<\/p>\n<p>Meanwhile, some Texas-based crypto companies have already expressed excitement for HB 4474. Joseph Kelly, CEO of Unchained Capital \u2014 a Bitcoin native financial services company \u2014 told Cointelegraph that the firm does a lot of business locally and that having greater clarity around Bitcoin\u2019s treatment under Texas statutes will help his company while encouraging other states to follow suit:<\/p>\n<blockquote><p>\u201cAs Texas and other states pass updates to their UCC that defines Bitcoin and spells out reasonable and commercial methods for perfecting a security interest in Bitcoin, it will help consumers and the industry avoid messy scenarios, lower average interest rates, and bring a greater proliferation of Bitcoin as acceptable collateral.\u201d<\/p><\/blockquote>\n<p>The challenges around liens still remain, however. While the solution is still unknown, Long hypothesized that Texas may be taking an approach that explicitly favors institutional lenders at the expense of decentralized finance projects and other peer-to-peer lenders.<\/p>\n<p>\u201cInstitutions have a way to perfect their security interests (by treating Bitcoin the same way that securities are treated under commercial law \u2014 as IOUs), but individuals and DeFi projects don\u2019t have that option available to them,\u201d Long commented. She further noted that she hopes Texas will be able to fix this in the same way that Wyoming did, as an amendment to the proposed law.<\/p>\n<p>Regardless of the outcome, it\u2019s notable that Texas has been taking measures to catch up to Wyoming\u00a0in terms of crypto and blockchain regulations. In addition to HB 4474, Bratcher mentioned that three other blockchain bills were also being\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/texasblockchaincouncil.org\/policy-page\">filed<\/a>. While Bratcher is aware that these bills do not go as far as Wyoming\u2019s bills, he believes Texas will rank right under Wyoming if Texas\u2019 blockchain legislation passes, adding:<\/p>\n<blockquote><p>\u201cTexas is the second-largest economy in the United States, and our congressional delegation is 10 times the size of Wyoming. We have much more influence in D.C. We just want to affirm what Wyoming is doing and come alongside them with a big economy and congressional delegation.\u201d<\/p><\/blockquote>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/texas-chases-after-wyoming-with-crypto-law-proposal-but-challenges-remain\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Texas chases after Wyoming with crypto law proposal, but challenges remain &#8221; Everything is bigger in Texas, but when it comes to crypto-friendly legislation, this doesn\u2019t seem to be the case\u2026 just yet. On March 12, 2021, Texas Representative Tan Parker introduced the Uniform Commercial Code, also known as UCC, amendment bill (House Bill&#8230;<\/p>\n","protected":false},"author":1,"featured_media":210661,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDMvYzNkNzhmZWMtNTZiMC00OTQ2LTk5YWMtNDZhMGRjNTEzZDVkLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74858,74894,99339,117,71511,55229,70934,72287,6474,67874],"class_list":["post-210660","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin-regulation","tag-blockchain","tag-texas-bitcoin","tag-business","tag-government","tag-law","tag-regulation","tag-security","tag-texas","tag-united-states"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/210660","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=210660"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/210660\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/210661"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=210660"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=210660"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=210660"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}