Blockchain Legislation For Idaho
How Idaho can catch up and ride the wave of the innovative future
20 billion dollars.
That is the short-term haul the State of Wyoming aims to get from East Asian and particularly Hong Kong businesses by the summer of 2019. The source: Blockchain companies. That is 20 billion dollars more than Idaho.
Wyoming lawmakers’ not so secret strategy is to keep leading the charge of Western Mountain States enacting the most forward-looking Blockchain legislation in the United States. Montana, Utah, and Arizona are close behind, but so far unable to catch up. Idaho, sadly, is nowhere to be found.
It is important to change that. And, it is not too difficult. Wyoming is trailblazing. This also means that they are doing the really hard work. Idaho can benefit from following rather than leading. But the state needs to act.
Ten days ago in Laramie, I attended a public session of the Wyoming Blockchain Task Force. Initiated by Wallstreet veteran Caitlin Long, this task force consists of three State Senators, three State Representatives, and three Governor appointees. Earlier in the year, their work resulted in Wyoming passing 13 blockchain-enabling laws considered leading in the U.S. Among others, these laws secure property rights for owners of crypto-currencies, provide regulatory relief for financial innovators, establish state-chartered depository institutions, and defines ”qualified custodianship” for digital assets.
Besides the influx of billions into a newly established crypto-banking system, the goal of Wyoming’s innovate legislation is to create an ecosystem for investors, startups and established technology companies. Already, led by multi-billion-dollar crypto-marketplace Kraken, some of the industry’s best-known names have announced their intentions to relocate from the Far East to Wyoming.
Blockchain is one of the most transformative emerging technologies of our times.
Why is it so important for Idaho to be part of this? Sooner or later the state and its citizens and businesses will need to confront Blockchain and crypto-technologies. If it is sooner, Idaho can shape and lead the way, and benefit in the process. If it is later, the state will have to rely on others. And, the innovative leadership and resulting economic benefits will then also disproportionally remain with those who took action earlier.
The stakes are huge. We are talking about one of the most transformative emerging technologies of our times.
Many people may not be familiar with the term “blockchain” but have heard of Bitcoin. As the world’s first widely adopted cryptocurrency, Bitcoin uses mathematics and encryption (therefore “crypto”) to allow people and machines to efficiently and securely interact directly with each other. This means that you can pay somebody else without needing a bank. The same technology, blockchain, can also let you send somebody else data without Amazon, Facebook, or the government spying on you. It also enables us to secure elections and governmental records. Each transaction is recorded in a publicly shared ledger, making this at least in theory the most transparent and secure way of doing business with each other.
The appeal of this technology and its benefits are so significant that not just startups but also most large businesses and governments are exploring its use. Many have started to implement it. Already today, blockchains secure global supply chain logistics and transfer value measured in the hundreds of billions of U.S. dollars. Most recently, Facebook announced its intention to launch a Blockchain-based currency called Libra. China and Japan are planning to introduce their own crypto-currencies. International organizations like the European Union and the OECD welcome the technology and treat artificial intelligence (AI) and blockchain as two sides of the same coin. The use cases will keep expanding, particularly with further digitization and the advent of the Internet of Things (IoT).
At a time when law enforcement in many countries still focuses on Bitcoin being used as payment during a small fraction of all crimes, the thought leaders and innovators have already moved far ahead. Their ambition is nothing less than to redesign and harden the underbelly of the Internet. They want to create vast economic efficiencies, eliminate fraud, protect economic freedom, empower the poor and unbanked, and secure everything from elections to data and privacy.
The intellectual leadership comes from top universities. Among the trailblazers are reputable institutions like Berkeley University, the Massachusetts Institute of Technology, Cornell University, and the Swiss ETH. It goes far beyond academia, with an unusual coalition of technology entrepreneurs, thought leaders, cryptographers, anarchists, cybersecurity advocates, social activists, libertarians, business leaders, and freedom-of-speech champions. Venture capital from Silicon Valley, East Asia, and Europe funds their efforts, and so does direct private investment from individuals.
Blockchain industry events bring together large technology communities and business and political leaders with full-week programs in cities and nations across the globe. This is not limited to the technology hubs of San Francisco, Boston, and Hong Kong but sometimes involves whole countries like South Korea and Japan.
I am right now in Seoul at one the largest of these events. The Korea Blockchain Week assembled a who-is-who of the world economy. Participation includes large businesses, banks, start-ups, venture capitalists, international organizations, and governments.
This is typical. Despite America’s unique technology and innovation prowess, much of the action is overseas. A major reason is the lack of legal clarity. In the United States, there are few laws and regulatory standards for investment, taxes, and property rights of this new breed of digital assets using blockchain.
Which brings us back to Idaho. Not only will the state and its citizens and businesses be unable to escape the impact of blockchain. It also has a unique opportunity, due to a lack of action of the federal government and most other state legislatures. By rapidly and forcefully enacting legislation modeled on Wyoming’s, Idaho can shape national legislation that thoughtfully protects property rights and free business activities.
This also can further drive Idaho’s upwards path in the rankings of technology innovation, exemplified by its higher education institutions and businesses.
While New York State is still too busy protecting its established Wallstreet banks’ interests, Wyoming is right in line with other pioneers, like Switzerland, Estonia, Dubai, Singapore, and South Korea. This is where Idaho belongs. Idaho universities are already co-leading the nation in many innovative capabilities. The University of Idaho is known to be a leader in cybersecurity, and Boise State has advanced to become an acknowledged Research 2 university.
The meeting of the Wyoming Crypto Task Force showed that it is time to act. As a result I have started the Idaho Blockchain Initiative. Its first goal is to take stock of the interest of the public, the business community, and lawmakers. Then, we want to help educating, coordinating, and guiding efforts that drive Blockchain innovation in the state.
Idaho could use billions also. Right?
