California Steps Forward To Adopt Cryptocurrency And Its Regulation

The hometown of most of the technological innovation, California on Wednesday became the first state to explore how to adapt digital assets and related technology in a broadway.

Tracing the steps of President Joe Biden in March, Gov Gavin Newsom also signed an executive order for state agencies to work together with the federal government to draft regulations for digital assets. In addition, it also orders officials to probe into methods to incorporate broader blockchain computer coding into operations conducted by the government.

Dee Dee Myers, Director of the Governor’s Office of Business and Economic Development and a senior advisor to Newsom, said that the evolution of blockchain technology could potentially generate new companies, opportunities, and jobs.

Myers said that these “unknown opportunities” are another reason they want to “engage early.”

According to Newsom’s order, it should be a front to explore how to adapt to new technologies.

In recent years, the popularity of cryptocurrencies has exploded. In the U.S, around 16% of U.S. adults have used, traded, or invested in crypto assets. The number goes even higher in the case of young men. The Executive order of Biden partly inquired to the Federal Reserve whether it should create its digital currency.

However, many, including the world’s richest people, have questioned the legitimacy of cryptocurrency. The newly-made Twitter owner has supported the mem-inspired token dogecoin, while recently, Warren Buffet commenting on Bitcoin, said that he would not lend anyone even $25 in exchange for all of the Bitcoin.

Many lawmakers around the U.S have come up with such legislation before but haven’t been successful yet. Sydney Kamlager, a senator, introduced a bill that proposed state services to accept crypto assets but was unsuccessful in its first committee this year. Jordan Cunningham, a Republican Assemblyman, too proposed a similar bill which, too, is stagnant.

Wyoming and Arizona are other states to introduce such measures.

Newsom’s order wants California to lead in the adoption of technological evolution.

A July 2020 report by the California Blockchain Working Group provided the basis for his order. The report talks about blockchain use along with its benefits and risks.

The very same year, California built a new Department of Financial protection and Innovation, previously the Department of Business Oversight, with the aim of figuring out emerging risks and opportunities while at the same time safeguarding consumers.

The order by Newsom also talks about the guidelines for disclosures by companies when they provide services and financial products related to crypto-assets. Further, it will also layout guidelines for state-chartered banks and credit unions regarding crypto-related products.

A separate agency is also directed by Newsom’s order that requests proposals for how to make the best use of blockchain to help the state and the public.