Phil Stephenson, a Republican from the Texas house of representative has introduced a bill that would force the crypto users to identify themselves if the bill is passed in the house. H.B. No. 4371 states that every crypto user who sends or receive any form of the digital entity must be known to the state. However, if the users use “verified digital currency” they don’t have to submit identity verification to the state.
The bill if passed would be put into reinforcement by September 1, 2019, and anyone either sending or receiving the digital asset need to verify their identity to the state. However, if they are using a state verified identity digital currency, then there is no need for identity verification. Here is what the H.B. No. 4371 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.”
Not Everyone is Amused at the Proposed Ban on Anonymous use of Crypto
The said bill in question attacks the basic principle of cryptocurrencies i.e censorship resistance, and not everyone seems to be eccentric on the new development. Texans for Fiscal Responsibility, a non-profit organization gave the Stephenson’s bill a 40% rating which is quite low for a Republican lawmaker.
The proposed bill states that various agencies would provide tools to the users which can help them determine whether a digital asset they are using falls under the bracket of “verified identity digital currency” or not. The Republican lawmaker is quite confident over his approach claiming that the new bill would help the state with a financial solution.
However, the majority of the people associated with the decentralized world are skeptical about the development of the ban on the use of crypto anonymously. Andrew, founder of Athena Blockchain explained why such a move could hamper the growth of crypto and believes the current bill is quite vague and does not answer many questions like,
“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?”
Texas has been known for being a friendly place where people’s rights and privacy are respected, be it friendly gun laws or even the crypto used in the state. However, the new bill, if passed, could hamper the growth of crypto use and how people perceive Texas in general.
Cryptocurrency was introduced for the sole purposes of being a privacy field and censor-resistant form of economy. However, the recent bill could really take back Texas far-behind in crypto adoption.