Do You Live in a Blockchain-Friendly State?
Let's be honest.
It's safe to say that the current digital currency market is "under construction."
A lot of big changes have taken place since 2017, when you could invest in a random popup initial coin offering and make 400% in a matter of days.
These kinds of gains were possible because there simply was no regulation or law in the digital currency space. And while some people made the transition from pauper to prince, others were robbed blind.
But it's not going to be like that for long.
These days, the digital currency market is being regulated, which has put a damper on massive overnight profits.
And, despite a huge amount of investor whining, this regulation is a good thing.
In the end, we couldn't have lived without market regulation forever. Regulation means the market is maturing, and it marks a critical step in establishing the legitimacy (and application) of blockchain technologies.
There are likely new profits at the end of this regulatory tunnel. Investors just need to stay alert.
With that in mind, regulation shouldn't cause investors to abandon the space. It creates an opportunity for them to start seeking out winners on a whole new playing field.
Those winners will be found in the companies, startups, and states that are using blockchain to build a stronger economic future.
We talk about blockchain companies a lot in Token Authority, but today I wanted to use recent regulation as an opportunity to talk about the third and rarely mentioned player, the states.
Over the course of this article, we're going to look at some of the friendliest states when it comes to blockchain development, education, and financial policy.
To begin this conversation, we have to go deep into the American Heartland, where one state caught the whole market by surprise by claiming blockchain for its own.
The Friendliest Blockchain State
We're living in the heat of a technological revolution, and during that revolution, states and companies will seek to redefine themselves, assuring their future survival.
Obvious adopters include the states that have been endlessly devoted to tech, including California and Texas.
However, the state that is actually leading the blockchain revolution is not usually on the radar for innovation.
In fact, it's a state more famous for cowboys and open fields than innovation. That said, this particular state is also famous for doing things first, becoming the first to grant women the right to vote and the state to elect a female governor.
I'm talking about Wyoming.
Wyoming was one of the first states to pass blockchain-positive legislation in 2017. This legislation attracted the attention of cryptocurrency companies and startups from around the globe.
The legislation was pushed by the Wyoming Blockchain Coalition, which has been trying to educate and further blockchain innovation in the state.
These new bills achieve a few things for blockchain.
The first of the bills will establish Wyoming as an attractive state to the blockchain industry, with zero corporate income or franchise taxes and strict privacy laws governing LLCs formed in the state.
Best yet, companies don't even need to be in Wyoming to take advantage. However, there are quite a few reasons that businesses will want to move there. The state's capital, Cheyenne, boasts both a powerful fiber-optic bandwidth and cheap power, which is already attracting major data centers to the state.
All these laws help lay a foundation for Wyoming — not just for blockchain innovation but also for the development of positive blockchain regulation in the future.
Beyond that, Wyoming is one of the only states in which Coinbase, the world's leading software wallet, does not operate. However, this may change with one of the new bills, which would allow Coinbase to operate through an exemption.
Arizona Takes Second Place
The runner-up for most friendly blockchain state also comes as a surprise to many: Arizona.
Arizona easily wins second place, confirming its spot by passing blockchain-friendly legislation in April 2018.
The legislation was signed by Governor Doug Ducey, and it allows corporations to hold and share data on a distributed ledger.
It passed with 56 in favor, three against, and one in abstention. One of these bills aims to make it easier for individuals to mine cryptocurrency within their homes. Another addresses both security and utility tokens.
Outside of that, the rest of the state has also demonstrated a forward-thinking attitude.
Students at the University of Arizona have banded together to create a Blockchain Innovation Society. The goal of this society is to create and develop new blockchain-based ideas and educate the wider community on the benefits and application of blockchain technology.
If this isn't enough, there is even talk that soon the people of Arizona could use Bitcoin to pay their tax bills!
That's quite a switch from 2017, when states were cracking down on crypto left and right.
The Honorable Mentions
While Wyoming and Arizona easily scoop up first and second place, there are quite a few other states out there leading the blockchain charge.
States that deserve a mention include Texas, which was the first to issue a memorandum declaring that no money transmitter license is needed to sell Bitcoin and other virtual currencies. A money transmitter license was what originally kept Coinbase out of Wyoming.
Texas's Bitcoin-friendly ways have allowed it to become a hub for blockchain. It's the home of multiple prominent blockchain startups and Bitcoin conferences.
Another state that deserves a mention is Montana.
Montana used cryptocurrency to create more jobs, providing a grant worth $416,000 to a local digital currency mining company called Project Spokane. The goal was to boost street businesses in the state.
Outside of that, Montana was an early Bitcoin supporter, allowing its citizens to buy and sell the cryptocurrency without a slew of regulations.
In the coming months, we will keep Token Authority readers up to date on how these states and their regulation of blockchain matures. Every brick laid now will help shape the blockchain innovation of the future.
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@AlexandraPerryC on Twitter
Alexandra Perry is the managing editor of Token Authority and the associate editor of Technology and Opportunity. She also contributes weekly content to Wealth Daily, a free investment research newsletter that addresses a range of market topics. She has multiple years of experience working with startup companies, primarily focusing on artificial intelligence, cybersecurity, alternative energy, and biotech. Her take on investing is simple: a new age of investor can make monumental returns by investing in emerging industries and foundational startup ventures.