State of New Hampshire takes another friendly step towards blockchain technologies. This news reminded me the ambitions of city of Lugano in Switzerland to adopt bitcoin as de facto legal tender. I wrote about this two weeks ago in my post titled City of Lugano In Switzerland Wants Bitcoin As Legal Tender. Feel free to read to find out more about interesting bitcoin developments in Lugano.
Just like city of Lugano, New Hampshire is a beautiful state. It also has gorgeous mountains, beautiful lakes, and breathtaking greenery everywhere. With their actions like this law they have introduced and passed in their state house of representatives, they want to signal to entrepreneurs that it is great place for developing blockchain technologies. They do want to attract more crypto businesses to the state. With states like Wyoming and Texas also taking such steps, it looks like there is a competition among state who can become a better home for blockchain development.
I am normally very skeptical about anything politicians do or say. This bill seems to be express genuine desire to be crypto friendly. While it is still not a law until state Senate votes for it and the governor signs it, I do like the language they use. The intentions are very clear from the title of the bill - Exempting the developer, seller, or facilitator of the exchange of an open blockchain token from certain securities laws and adopting the Uniform Commercial Code relative to controllable electronic records.
The part I like most is, unlike the federal government, central banks and international bankers, they use the wording of Open Blockchain Tokens instead of digital assets. When central and international banks refer to bitcoin and crypto they normally just say "digital asset/money". I believe that is a deceptive tactics to confuse people and push their agendas of CBDCs. But that is another topic.
I do agree with New Hampshire lawmakers, the more appropriate words to define bitcoin and crypto assets would be Open Blockchain Tokens. Brilliant! I am even more impressed by these lawmakers when I read how they define what open blockchain tokens are.
According to this bill, Open Blockchain Token means a digital unit which is Created:
- In response to the verification or collection of a specified number of transactions relating to a digital ledger or database.
- By deploying computer code to a blockchain network that allows for the creation of digital tokens or other units.
- Using any combination of above two.
They continue describing Open Blockchain Token as recorded in a digital ledger or database which is chronological, consensus-based, decentralized and mathematically verified in nature, especially relating to the supply of units and their distribution. Open Blockchain Tokens are capable of being traded or transferred between persons without an intermediary or custodian value.
It does look like they have done their homework and know what they are talking about. It is great to see a competent approach to a bill by politicians for a change.
What does the bill do? It is provides exemption for blockchain developers, coin issuers, and token trading facilitators from laws that would otherwise consider these assets as securities. Those who would want to take advantage of such exemption would still need to apply for it through the Secretary of State and meet the conditions described in the bill. These conditions do seem to be reasonable as well. To paraphrase: don't be a scammer, don't advertise or sell your coins as financial instrument to get rich, make sure the token is created for consumptive purpose. You can read the full text of the bill here.
It is still too early to celebrate. This will not become a law until state Senate also votes for it and the governor signs into law. The governor has not endorsed the bill. However, the governor of the state had issued an executive order in February to create a commission to make findings and determinations of the current laws and regulations regarding cryptocurrencies and their effectiveness. So, looks like the governor is open to bring changes that are more appropriate to the blockchain technologies and cryptocurrencies.
Even if this bill becomes a law, it still doesn't mean it can override federal laws. It still doesn't mean all is great for crypto. This is just a small step, a friendly one towards facilitating innovation. Governments don't need to do much or anything for crypto. Creative minds will do their magic, builders will build, innovators will innovate, developers will develop. Governments should just stop creating obstacles, and offer clarity instead of confusion. This bill is a move in a right directions. I hope to see more and more positive moves like this in the future.