The House Bill 70 of Wyoming passed by the House of Representatives on February 20 is a major landmark in making the expansion and influence of crypto world a reality. After the State Senate passing the bill, Governor Matt Mead signed it in mid-March to become one of the first administrations across the world with a concrete approach towards cryptocurrencies.
The creation of a new asset class in the crypto world can be considered as a positive thing, especially when various governments and central banks take tough stands towards cryptocurrencies. The new bill reveals a number of facts to every cryptocurrency investor.
Governments want Clear Definition of Cryptocurrency Assets
With the bill, any blockchain token with a consumptive purpose which is not serving an investment purpose gets the status of utility tokens. It means that specific cryptocurrencies get a new definition and legal status. The move also shows the changing thoughts of the governments to utilize the possibilities of blockchain technology and cryptocurrencies efficiently.
It is a significant step towards the recognition of one of the major purposes of the cryptocurrencies – creating an asset class in the crypto ecosystem that can help companies to raise funds. It also adds the idea of virtual currency more legalized and acceptable though there are plenty more to go for realistic and meaningful policies and frameworks from the governments in the area.
Leverages Serious Players
The bill leverages the serious players in the crypto world as it curtails the possibilities of investment scams up to a larger extent with the new definition. Per the bill, the developer or seller of any utility tokens cannot market or sell those to the first buyer with investment intent.
It means that the buyers get the confidence of deceitful crypto campaigns not riddling their money at the end as such campaigners are seriously hit with the new bill in the long term. Even the existing players would put sincere efforts to improve the value of their utility tokens since the falling price of the tokens directly depicted as the failure of their primary products. When the tokens are coming through regulation, its falling prices can hit the value of the stocks of the company since the market takes it as an indicator.
More Thoughts and Innovations
When it comes to the crypto world as a whole, it adds more thoughts for innovations to think for new ways to get more acceptability. The current boom of cryptocurrency is the result of the initial excitement that can become detrimental if it could not win the trust of the investors in the long-term.
Still, a significant percentage of conventional investors are reluctant to float their funds in the asset class due to the fluctuations, different scandals, and the unregulated nature of cryptos. Especially after the surge of the major cryptocurrencies by the end of 2017 and the sudden fall to one-third of its value by the first week of February 2018, the new investors are wary of cryptos.
Therefore, it is the right time for the crypto players to take the initiative of Wyoming positively and move forward to a more structured ecosystem. Interestingly, Israel has also begun initiatives to give a clear definition for utility tokens and recommending relaxed regulations for ICOs.
Though there are questions on the new bill and its conflicts with the Federal security laws, it adds optimism to the entire industry. Now, the world is serious about the crypto ecosystem in every aspect; watch out for the next episode of the show!