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California Starts State-Sanctioned Crypto Journey

California Starts State-Sanctioned Crypto Journey

California’s governor Gavin Newsom has signed an executive order that will kickstart the official crypto industry in the state. 

Gov. Newsom Signs Executive Order

The executive order has initiated the process of setting up a regulatory framework for blockchain technologies and digital assets in the state of California. According to the order, state authorities will also be drafting regulations to guide the crypto industry in tandem with federal agencies. In addition, officials will also be looking into incorporating blockchain tech into government operations in California, which is a global hub of tech innovations. 

Other than collecting feedback from crucial stakeholders to structure the regulatory framework and studying and incorporating blockchain tech in state and public institutions, the state will also open up channels for research and development programs in blockchain and crypto. 

Following the signing, Governor Gavin Newsom released a statement that said, 

"California is a global hub of innovation, and we’re setting up the state for success with this emerging technology – spurring responsible innovation, protecting consumers and leveraging this technology for the public good. Too often government lags behind technological advancements, so we're getting ahead of the curve on this, laying the foundation to allow for consumers and business to thrive.”

Initial Steps Taken In 2020

The executive order is built on a July 2020 report by the California Blockchain Working Group that examined the uses, risks, and benefits of blockchain technology. In addition, the California Consumer Financial Protection Law, which was passed back in 2020, will be a key driving force in ensuring that the regulatory framework maintains a “transparent and consistent business environment” for companies in the blockchain and crypto fields. 

2020 was also the year that Governor Newsom restructured the Department of Business Oversight into the new Department of Financial Protection and Innovation to extend its oversight to the growing crypto industry. This department will address consumer complaints, work with crypto companies to resolve consumer complaints, take enforcement action when needed, and also work on spreading crypto education, especially regarding scams and frauds. 

Texas In Action

Although California will be the first US state to explore the regulatory aspect of the industry officially, Texas has been so far leading the charge in blockchain and crypto adoption. Mayor Steve Adler of Austin, Texas, has always maintained a very pro-crypto voice by proposing blockchain adoption and BTC payments for civic bills across the city. As a result, the Austin City Council has also passed two resolutions related to crypto assets and blockchain technology. More recently, the small city of Fort Worth in Texas became the first US city to mine Bitcoin after three mining machines were donated to the city by the Texas Blockchain Council. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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