The State of Texas in the U.S. also hopped in the crypto hype train as it rolled out an important announcement on Thursday.
Another win for cryptocurrency
On June 10, The Texas Department of Banking published an industry notice – “Authority of Texas State-Chartered Banks to Provide Virtual Currency Custody Services to Customers.”
As the title suggests, this affirms the state-chartered banks to give their customers “virtual currency custody services” provided that the said financial institution “has adequate protocols in place to effectively manage the risks and comply with applicable law.”
Further, Texas’ State Banking Department’s Assistant General Counsel Marcus Adams said that the state has been noticing the increasing popularity of the cryptocurrency industry adding that it has been trying to get out ahead of it to make sure that the banks they’re regulating have enough resources to remain competitive.
Denton Record Chronicle noted that the Department of Banking currently handles and regulates 216 chartered banks in the Lone Star State.
Saylor says thanks
Texas Governor Greg Abbott even took to Twitter to announce such development. In his tweet, he stated that the country’s second-largest state is “open for crypto business” as it won votes of confidence from both him and the Texas Department of Banking. MicroStrategy Chairman and well-known Bitcoin (BTC) proponent Michael Saylor responded to his post and thanked him for the support. Saylor went on to note that “Bitcoin is the most powerful technology in the world for converting into freedom and prosperity.”
Texans, on the other hand, have mixed sentiments on such a move. While there are folks who are in favor of it, there are also those who are not having it as they are citing its environmental impact.
It was pointed out that this is not a new law, but rather Texas determining that an existing law gives it a green light.
Typically, if a person owns cryptocurrency, this translates to him/her having these private keys in a wallet to gain access to their virtual funds. With this ruling in Texas, however, that responsibility can be turned over by that person to a third-party bank. There, the financial institution can either have their customer fully turn over their crypto assets to them or they can just store a copy of the key to their customer’s wallet.
Abbott to sign Virtual Currency Bill
However, Adams made it clear that banks need to check on themselves first whether they have proper risk management in handling such responsibility.
Abbott, in a couple of weeks, will be signing a so-called “Virtual Currency Bill” as this will formally cement the legality of digital currencies in Texas. The state will become second after Wyoming to acknowledge both cryptocurrency and blockchain in its Uniform Commercial Code.
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