![]() Specifically, the TSA applies to firms and individuals who sell securities or render investment advice in Texas. Accordingly, a cryptocurrency firm offering an ICO to the public must comply with the Texas Securities Act (TSA). Second, the Act requires cryptocurrency companies and investors to follow the existing commercial laws of Texas, such as the state’s Business & Commerce Code. The statutory definition of virtual currency does not include: (1) a transaction in which a merchant grants a value that cannot be exchanged with the merchant for legal tender, bank credit, or virtual currency as part of a rewards program nor (2) a digital representation of value issued by or on behalf of a publisher and used solely within an online game, game platform, or family of games sold by the same publisher or offered on the same game platform. Under HB 4774, virtual currency is defined as “a digital representation of value that is used as a medium of exchange, unit of account, or store of value” that is not legal tender. Under section 12 of the TVCA, the Act becomes effective on September 1, 2021.įirst, the Act legitimizes the legal status of cryptocurrency by providing it a legal definition. Overall, the law specifically addresses cryptocurrency by: (1) recognizing the legal status of virtual currency, (2) ensuring that cryptocurrencies are subject to commercial laws under Texas regulations, and (3) supplying legal rights to cryptocurrency holders. The short title of the bill is the “Texas Virtual Currency Bill” (TVCB). Specifically, the bill adds amendments to the state’s Business & Commerce Code to address virtual currency. On June 15, 2021, cryptocurrency-specific legislation was passed under the laws of Texas when Governor Abbott signed House Bill 4474 into law. HB 4774 – The Texas Virtual Currency Act (TVCA) Requires each state agency and local government would be required to consider using next-generation technologies, including cryptocurrency, blockchain technology, and artificial intelligence.Įstablishes the Texas blockchain working group. Relates to business entities includes a distributed electronic network or database employing blockchain or distributed ledger technology in definitions.Ĭreates programs and requirements for state agencies and local governments to assess cybersecurity risks. "If all of them were to connect in the timelines that they are looking to connect, then it probably would present an issue to the grid because that load would be growing way faster than it ever has before.Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology Texas "There are a lot of Bitcoin mines that are trying to connect to the system," said Joshua Rhodes, a research scientist at the University of Texas at Austin. In Texas, where about 250 people died during a winter storm blackout that exposed the fragility of the state's grid, the prospect of higher crypto demand has raised alarms. The average American home uses about 10 MWh in a year, according to the Energy Information Administration. Its McCamey, Texas, site last month consumed 173,000 megawatt hours of power – about 60% provided by the grid and nearly 40% from the nearby wind farm. Bitcoin Corp, which has one of its mining operations in a 280-megawatt wind farm in Texas. "Bitcoin mining is a very energy intensive business, which is why we tend to find places like West Texas to be full of Bitcoin miners," said Matt Prusak, chief commercial officer at cryptocurrency miner U.S. Other states are expected to follow suit.īut in Texas, some counties have offered tax incentives and miners continue to be drawn to its wind and solar power, which could supply about 39% of ERCOT's energy needs in 2023. New York this year imposed a ban on some cryptocurrency mining that runs on fossil fuel-generated power. Treasury secretary and commodities regulator for a regulatory framework. The industry also faces new federal regulations, including a proposed 30% tax on electricity usage for digital mining and calls by the U.S. ![]() "There's been some challenges with the Bitcoin mining industry," Bratcher said, noting his group recently saw two prominent bankruptcies and other miners scaling back expansions. Those demands amount to about 3.7% of the state's lowest forecast peak load this year, according to data from grid operator Electric Reliability Council of Texas (ERCOT). That power usage rose 75% last year and was nearly triple that of the prior 12 months, Bratcher said. MCCAMEY, Texas, March 23 (Reuters) - Cryptocurrency bankruptcies and worries over electric power consumption have failed to dent the industry's growth in Texas, according to a top trade group, citing the rise in the miners' power demands.īitcoin miners consume about 2,100 megawatts of the state's power supplies, said Lee Bratcher, president of industry group Texas Blockchain Council.
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