The Cowboy State is staking yet another cryptocurrency claim in its state legislature, its third since last December.
Wyoming’s Senate has passed Senate File Number 0111 Property taxation-digital currencies (SF0111), stating that “virtual currencies … shall be exempt from property taxation.” It now goes on to the Wyoming House of Representatives.
Introduced on February 16 by state senators Driskill (R), Nethercott (R), and Rothfuss (D), the bill was supported in the state‘s House by Representatives Olsen (R), Miller (R), and Lindholm (R).
The bill garnered broad support from both Republicans and Democrats, earning 26 ayes with 3 nays and 1 excused exemption.
While SF No. 0111 is a departure from the position held by federal taxation authorities – like the Internal Revenue Service (IRS), which has defined cryptocurrency as property, requiring those with exposure to pay federal income taxes. The state-sponsored bill is generally perceived as in step with Wyoming’s gritty taxation reputation, namely the lack of state-level income taxes.
At only two pages, the concise bill is not very substantive, save for a brief classification of “virtual currency” as “any type of digital representation of value that; 1) Is used as a medium of exchange, unit of account or store or value; and 2) Is not recognized as legal tender by the United States government.”
While this definition is broad in the scope of its classification, it does call to attention the lack of satisfactory terms available for discussing cryptocurrencies, let alone for creating regulatory frameworks to support the new technology/asset class.
Interestingly, SF No. 0111 follows two other House bills related to cryptocurrency in Wyoming, both introduced on February 13. The first, HB0019, is an exemption for “virtual currency” from regulation under the Wyoming Money Transmitter Act. The second, HB0070, effectively removes cryptocurrency (“utility tokens”) from underneath an umbrella of classification that had digital currency pegged as “money” or as a monetary “security.”
Both HB0070 and HB0019 passed on February 19 with 60 ayes and zero nays and have since been received for introduction in the senate.
The actions by the Wyoming state legislature are evidence that the debate surrounding cryptocurrency terminology, classification, and regulation is still smoldering underneath the empires being built by early movers on top of the crypto-gold rush.
If unchecked by the Feds, Wyoming’s games of jurisdictional competition may help to attract big businesses looking to capitalize on the crypto boom. With cold temperatures for mining and high-speed internet, Wyoming might be taking steps to become something of a silicon valley itself.
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