Regulation and blockchain technology are not often a good combination. There is a lot of confusion regarding how blockchains work and what part of them can be regulated in the first place. Nevada is perhaps the first region in the world to officially introduce a pro-blockchain bill. The goal is to block local entities from taxing blockchain transactions. This is quite an intriguing development, but what does this pro-blockchain bill even mean?
A Pro-blockchain Bill is Quite Interesting
It is the first time someone used the term “pro-blockchain bill” in a manner that will not offend the overall cryptocurrency community. The state of Nevada has proven to be quite open-minded when it comes to blockchains and cryptocurrencies these days. In fact, the State Legislature approved a bill preventing local governmental entities from taxing any blockchain transaction. While this sounds great on paper, enforcing this new bill could prove to be quite challenging, to say the least.
Senate Bill 398 was first introduced in March of this year and is now presented by Governor Brian Sandoval to be signed. Governmental entities can’t impose any tax or fee on the use blockchains by both individuals and entities alike. Moreover, they can’t require these users obtain a license or permission to use blockchain technology either. This latter part is quite interesting, as it could prove to be quite beneficial for any company working with blockchain technology in the State of Nevada.
On paper, this bill seems to be a massive victory for anyone enthusiastic about blockchain technology. Having a form of legislation put in place to prevent taxation and licensing requirements is a massive breakthrough, to say the least. However, it has yet to be enacted, which may take quite some time before that happens. It is good to know such a proposal exists to prevent governments from restriction blockchain efforts in the state of Nevada.
The bigger question is how local regulators will determine which blockchain is being accessed by someone in Nevada at any given time. There is no viable way to determine whether a particular blockchain transaction originates from Nevada, or is related to someone living in the state. That type of information is not visible to anyone, which makes it pretty difficult to enforce this bill in an official capacity. It seems to be more of a victory for companies experimenting with the technology in the state, which is still good news.
What is rather peculiar is how this bill removes any context related to decentralization. Instead, it talks about blockchain technology in general, which leaves no room for interpretation whatsoever. That could end up being a smart decision, although it remains to be seen if this new bill will have any effect whatsoever. On paper, it is a good bill, but its effects have yet to be determined in a real world capacity.
In the end, it is good to see US states acknowledge the usefulness of blockchain technology in general. It also goes to show bills such as these can prevent governments from issuing license requirements to use the technology. In the world we live in today, having a legislative bill in place to prevent governments from obstructing the free use of public technology has become somewhat of a must. That is rather disappointing, but it is important to say ahead of the curve.
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