A Republican member of the Texas House of Representatives, Phil Stephenson, has just introduced a bill that would require residents of the state to identify themselves if they wish to use cryptocurrencies. H.B. No. 4371 details that individuals who send and receive digital currencies must be known. Although, if the user happens to use a “verified identity digital currency,” then they don’t have to submit verification to the state.
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Texas House Bill 4371 Wants Digital Currency Users in Texas to Verify Their Identity
Texas could be the first state in the U.S. to ban the anonymous use of cryptocurrencies. Representative Phil Stephenson, a staunch Texas Republican and certified public accountant (CPA), wants residents in the state to verify their identities if they choose to use digital currencies. Stephenson’s H.B. No. 4371 says that if the bill becomes law it will take effect on Sept. 1, 2019. Section 662.02 details that before accepting digital currency payment, a person must verify the identity of the sender. Oddly enough the person is “not required to verify the identity of a person sending payment if the payment is sent by a verified identity digital currency.”
H.B. No. 4371 further states:
[Texas] may not use a digital currency that is not a verified identity digital currency — The Texas Department of Banking, Credit Union Commission, Texas Department of Public Safety, and State Securities Board shall collaborate to encourage the use of verified identity digital currencies.
‘Attacking the Anonymous Use of Cryptocurrencies’
Stephenson’s bill notes that the agencies mentioned will provide the public with tools so they can determine the difference between a verified identity digital currency and one that provides anonymity. The Texan lawmaker, who recently won his seat against Democratic challenger Jennifer Cantu, believes his CPA can help the state with financial situations. However, free-market nonprofit organization Texans for Fiscal Responsibility gave Stephenson a 40 percent favorable rating, which is very low for a Republican lawmaker.
Cryptocurrency advocates were quite flustered to hear the news that a bill attempting to ban anonymous digital currency use was submitted. “Congratulations Texas, you’re the first state to formally attack and attempt to ban anonymous use of cryptocurrency in the U.S.,” Andrew Hinkes, cofounder and general counsel of Athena Blockchain, exclaimed on Twitter.
Other questions: Would any existing cryptocurrency or digital currency qualify as a ‘verified identity digital currency’ as defined? What level of ‘ID’ is required to be ‘verified’? State issued? Are four state administrative bodies the right entities to ‘promote’ a digital currency?
It’s safe to say that a large majority of cryptocurrency fans were disheartened to hear about the bill. Texas is well-known for being a friendly region when it comes to digital currencies and overall personal freedoms like gun rights. If the bill passes then it could very well affect business operations and add a wide variety of other challenges for citizens who believe in privacy.
What do you think about Republican Phil Stephenson’s H.B. No. 4371? Let us know what you think about this subject in the comments section below.
Image credits: Shutterstock, Pixabay, and Capitol.texas.gov.
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