Wyoming Looking to Become America’s Crypto Capital

In the last few years, Wyoming has passed a slew of crypto-friendly regulations that, in addition to zero corporate and personal state income taxes, have created an environment extremely conducive to crypto investment and development.

Caitlin Long Begins Crypto Journey in Wyoming

Wyoming’s walk down the crypto path was spurred by the personal crusade of state native and Wall Street insider, Caitlin Long, who back in 2017 spent the course of a 20-day legislative session in Wyoming’s state capitol having one-on-one conversations with lawmakers regarding cryptocurrencies and blockchain technology. 

Her efforts led to the establishment of the Wyoming Blockchain Task Force, which has steered the crafting and passing of dozens of crypto and blockchain-related laws four years down the road. Those laws have clarified the treatment of crypto assets and created the legal foundation for smart contracts, thus elevating Wyoming’s standing in the crypto space. 

Wyoming Legalizes Crypto Banking

While U.S. federal regulators have been reluctant to allow banking services for the crypto industry, Wyoming passed a law introducing a banking charter that changed how crypto banking is carried out. The bill, called HB0074, gave birth to particular purpose depository institutions (SDPIs), which are crypto banks for all intents and purposes. 

Four banking charters have been granted so far by the Wyoming Division of Banking, allowing crypto startups to access critical financial services. The San Francisco-based crypto exchange Kraken was the first firm to become an SDPI. Others to have taken advantage of the HB0074 bill include Commercium Financial, Wyoming Deposit and Transfer, and Caitlin Long’s Avanti Financial Group.

Cryptocurrencies Exempted From Money Transmission Laws

While states like New York require crypto projects to get a money transmission license, Wyoming passed House Bill 19, which exempts cryptos from acquiring a money transmission license in the state. In addition, the bill also exempted anyone developing, trading, or facilitating the exchange of crypto tokens from the money transmission laws. 

Another bill passed into law in Wyoming is Bill 38, which allows decentralized autonomous organizations (DAOs) to register as limited liability companies (LLCs). The concept of the LLC was also pioneered in Wyoming back in 1977 and is now one of the most ubiquitous forms of corporate structures globally. Bill 38 also allows LLCs to become DAOs.

Another critical law called HB 62, or the Wyoming Utility Token Act, was passed in 2019. HB 62 declared that crypto tokens with certain consumptive characteristics would be considered intangible personal property and be exempted from the state’s securities laws.

The other States Paying Attention

Wyoming’s cheap and plentiful energy sources, crypto-friendly laws, and favorable taxation regime, have made the state the most permissive place in the United States for crypto investors to do business. Major crypto and blockchain organizations like Ripple, Cardano, and Kraken have partly moved their operations to Wyoming. And states like North Dakota, Texas, Illinois, Nevada, and Montana are following Wyoming’s lead and have begun crafting and passing pro-crypto bills of their own.