The state of Texas is looking to be one of the first in the American union to regulate cryptocurrency. Texas Looks to Create New Crypto Regulation Not long ago, House Bill 1666 made its way onto the desk of Greg Abbott, the state’s governor. The bill is a nod to the FTX debacle of last year and will seek to ensure proper and safe trading environments for all residents of Texas that hold or trade digital currencies. The goal is to make sure everybody’s money steers clear of fraud and other issues known to arise out of the crypto arena. Each year, all virtual currency companies that do business with citizens of Texas will be required to adhere to certain rules like ensuring all customers can withdraw funds whenever they wish. Also, companies will need to provide
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The state of Texas is looking to be one of the first in the American union to regulate cryptocurrency.
Texas Looks to Create New Crypto Regulation
Not long ago, House Bill 1666 made its way onto the desk of Greg Abbott, the state’s governor. The bill is a nod to the FTX debacle of last year and will seek to ensure proper and safe trading environments for all residents of Texas that hold or trade digital currencies.
The goal is to make sure everybody’s money steers clear of fraud and other issues known to arise out of the crypto arena. Each year, all virtual currency companies that do business with citizens of Texas will be required to adhere to certain rules like ensuring all customers can withdraw funds whenever they wish.
Also, companies will need to provide proof of reserves to show that if there are ever any problems, executives can stay afloat and provide compensation and recompense to affected traders. Customers will also be able to garner information about the companies’ standing debts and see who they owe money to and how much.
Lastly, the firms in question would not be allowed to commingle funds (in other words, no mixing of company money with customer money), and they would be subjected to annual audits.
State representative Giovanni Capriglione, a republican, commented that he would like Texas to set an example to larger institutions like the federal government, and he hopes the regulation his region sets in place can provide rules and laws for surrounding areas as well. He said:
You will be comfortable knowing that when you invest online, when you’re buying cryptos, when you’re trading it, when you’re selling, those assets are being watched, that they are being managed, and that there’s an audit trail that protects those assets.
Texas is widely considered a very crypto-friendly state. The region opened itself to an influx of miners from China after their native country declared that the practice was fully illegal in the summer of 2021. Seeing the opportunities for growth, jobs, innovation, and a rising economy, Texas leaders said, “Come on in” and have built one of the biggest mining arenas of the last ten years.
Energy Issues Have Popped Up
However, while this attitude has resulted in a strong economy and powerful job prospects, it has created problems for the state’s energy grid. A new report by the Electric Reliability Council of Texas (ERCOT) states:
Prospective crypto mining businesses have requested to put approximately 33,000 more megawatts in the ERCOT interconnection queue over the next few years (enough to power the whole state of Florida)… A single bitcoin transaction used nearly 1,452 kilowatt-hours (kWh) of electricity, equal to the power consumption of an average U.S. household for nearly 50 days.