A number of states in the U.S. are beginning to pass blockchain-friendly laws. This comes as cryptocurrencies remain a divisive topic within the political landscape of the United States. However, blockchain technology seems to be enjoying almost universal appeal at least among state legislators in different states across the country. The state of Tennessee, in the southeast of the United States, has joined rapidly expanding league of states in the country that have passed blockchain-friendly laws.
According to LegiScan, a website that tracks pieces of legislation, the state of Tennessee has passed a law that recognizes blockchain technology and smart contract for use in electronic transactions. The law which was adopted by the state Congress and signed by Governor Bill Haslam on Thursday, March 22, 2018, gives legal status to blockchain technology and smart contracts within the state. Also, the law has a provision that essentially ensures that the right of ownership of specific information secured by blockchain technology is protected.
This new law was initially introduced as Senate Bill 1662 on January 18, 2018. The bill went through both houses uncontested. It was supported by a bipartisan alliance of Republican Senators Richard Briggs and Steven Dickerson, as well as Democratic Senators Jeff Yabro and Lee Harris.
Smart contracts are also recognized by virtue of this new law. In the state of Tennessee, it is no longer permissible to deny the legal validity or enforceability of smart contracts. The bill also goes to great lengths to provide definitions for both blockchain technology and smart contracts. According to the bill, blockchain technology is a distributed ledger protocol that can be either public or private as well as permissionless or permissioned. The bill also stated that blockchains can contain elements of electronic exchange via digital tokens. As for smart contracts, the bill defines it as a contract that is executed by means of a computer program.
Tennessee isn’t the only state that has tried to formulate legislation for blockchain technology and smart contracts. Florida and Nebraska have also tried something similar but their efforts haven’t been successful so far. According to LegiScan, the blockchain bill for Florida didn’t sail through the legislative process while the Nebraska bill is yet to be put to a vote. A bill recognizing blockchain signatures and smart contracts was signed into law in March 2017 by the Arizona state Governor.
Other states that have passed blockchain-based legislations include Georgia and Wyoming. In February 2018, Georgia passed a bill that effectively recognized cryptocurrency as a legal means for paying state taxes as well as license fees. In March 2018, Wyoming passed a law that recognized cryptocurrencies as a new, distinct asset class. This ruling essentially made cryptocurrencies to be exempted from the securities regulations operating within the state.
As far as 2016, the state of Vermont also passed its own landmark blockchain law. The law basically recognizes that any record that is verified by a blockchain is deemed authentic in the eyes of the law which means such records can be admissible in court.