Alabama representative Mike Shaw, R-Hoover has announced the intent to proclaim legislation to regulate cryptocurrency and blockchain technology, as it increasingly becomes an integral part of citizens in Alabama.
This comes barely a month after crypto stakeholders in Alabama including lawmakers and businesses met to discuss how to regulate the crypto market and blockchain technology for the benefit of all.
Shaw targets next year for the introduction of the regulation
In his address Wednesday, to attendees of the town hall meeting in Montgomery, organized by Coinbase, a cryptocurrency exchange firm, Shaw said the planned legislation will be introduced next year.
“I don’t know what it’s going to look like, but I’m planning on putting something together to introduce next year, but it’s going to take some time,” he said.
“We’re going to have to get legislators and the people understanding as much as they can about how the technology works, understanding the implications for economic development and what it can mean for our state.”
Shaw.
Currently, the lawmakers in Alabama have shown keen interest in researching how the state may benefit from blockchain technology as well as how this can be regulated.
Last month, Alabama legislature’s Blockchain Study Commission held its inaugural meeting to deliberate on the impending regulation. During the meeting, Alabama’s Securities Commission director Amanda Senn revealed that several companies had mushroomed in the crypto industry operating like banks and investment firms. However, the same companies are not subject to the same rules and regulations that govern those companies.
As a result, the Alabama Securities Exchange has been probing cases of fraud including cryptocurrency for about 10 years. Additionally, due to a lack of safeguards in Alabama, there have been a lot of concerns over potential money laundering and cryptocurrencies used to fund terrorism in foreign states.
This has created scope for lawmakers, businesses, and other stakeholders to push for regulation for the industry as it continues to gain traction.
Elsewhere, some states have already embraced blockchain technology. Recently, California digitized its records of 42 million car titles. However, most states are yet to adopt explicit regulations for cryptocurrency and have instead depended on existing money transmission statutes.
Alabama wants revamped regulation for the industry
Regarding the regulation of cryptocurrency, Shaw said it was imperative to have “a bit of a reboot.”
“I think it’d be an incentive (for cryptocurrency and blockchain investments) just to have a certain regulatory environment so they know what to expect here.
“A lot of the regulation in crypto is based on very old law, case law, and things like that, which is fine, but it’s so new that they’re trying to shoehorn it in sometimes. I think we probably need a little bit of a reboot,” Shaw told Alabama Daily News.
The town hall was convened at Prevail Coffee in Montgomery, whose owner is Wade Preston of the Alabama Blockchain Alliance. Not only did he participate in the Blockchain Study Commission last month, nevertheless, started accepting cryptocurrency as payment at his coffee shop recently.
Preston and Ashley Gunn, senior managers at Coinbase, unequivocally advocated for a regulatory environment to be established mainly for crypto, though they also warned against over-regulating the sector.
Meanwhile, lawmaker Phillip Ensler, D-Montgomery, was also a featured speaker at the event, and agreed that over-regulation of the cryptocurrency sector could asphyxiate investments and innovation.
“We don’t want to stifle small businesses, we don’t want to get in the way of investors or people that are looking to use it for economic development and growth purposes,” he said.
