A cryptocurrency bill is on the governors desk, but missing a key section

SALT LAKE CITY — A bill protecting people’s ability to use cryptocurrency to pay for transactions at businesses in Utah is waiting for the governor’s signature, but the bill’s sponsor says the legislation is missing some key components.

Bill sponsor Rep. Jordan Teuscher, R-South Jordan, said he’s happy the bill passed overall but is disappointed that part of the bill that would have let the state invest in Bitcoin had to be removed.

Teuscher said this bill is a result of the Blockchain and Digital Innovation Task Force, which included the attorney general and state treasurer, along with other leaders in the digital innovation space.

HB230 includes protections for digital assets, such as cryptocurrency and NFTs. These protections include ensuring Utahns can assess and use their digital assets and protecting digital mining company rights.

Changes to the cryptocurrency bill

Another part of the bill would have given the state treasurer the ability to invest in digital assets that have a market cap of over $500 billion for the state’s rainy day fund.

However, after passing in the Utah House, the rainy day fund investment option was removed before passing through the Senate. Teuscher said the treasurer may have been concerned about pressure to invest.

“I think the treasurer kind of had an about face on this,” Teuscher said, “as it got closer to the finish line, I think, he was afraid that it might put some undue pressure on him to actually invest in blockchain even though it was permissive. It was at his discretion of whether or not to invest.”

Teuscher also said the treasurer might have felt like the rainy day fund would not be a good place for blockchain investment to happen, since in an emergency the funds will need to be quickly liquidated.

But, the representative said he feels the same arguments about risk could be used for gold investments as well. Currently, the treasurer invests up to 10% of the rainy day fund in precious metals, including gold or silver.

Blockchain misunderstood?

Teusher also pointed out there may have been a problem with people understanding how the blockchain works, leading to especially older members feeling uncomfortable around the investment section of the bill.

“If you looked at the vote in the House when it still had those provisions,” Teuscher says, “it was almost like if you were, you know, over 45, you voted against it, and if you were under 45, you voted for it.”

If this section had remained, Utah would have been the first state in the nation to use state funds to invest in digital assets. Teuscher said around 20 other states have pitched, or plan to pitch, similar bills in their legislative sessions.

“With this bill and others that we’ve passed over the last few years,” Teuscher said, “I think the rest of the country has really seen Utah as a leader in this space … I would have liked to see Utah really lead out on this. Unfortunately, we weren’t able to get it to the finish line.”

He said he plans to pitch the provision again in a future session.

In the bill’s current form, one section Teuscher is especially excited about is protections around digital mining.