Bitcoin Businesses Push for Relaxed Startup Rules in California

Seven bitcoin businesses have drafted a letter to California lawmakers following the state's most recent update to its proposed industry regulation.

Jul 9, 2015 at 6:25 p.m. UTC
Updated Sep 11, 2021 at 11:46 a.m. UTC

A group of bitcoin businesses have drafted a letter to members of California's Senate Banking and Financial Institutions Committee following the state's most recent update of its proposed regulation for bitcoin and digital currencies.

Signed by BitGo, Bitnet, Blockstream, Chain, Gem, Mirror and Xapo, the letter praises the Senate for its most recent changes to AB 1326, particularly its elimination of certain redundant licensing and modification of its definition of "virtual currency business".

Perhaps most notably, however, the startups called on California to go a step further before the regulation is ultimately passed by updating certain language and removing additional burdens from early-stage industry startups.

The text reads:

"We appreciate the addition of the provisional license and would like to continue to work with you on ways to expand it and grow the ability of small startups to innovate and flourish. As California is the home of many major tech companies started in a garage, our hope is to enable the next generation of entrepreneurs."

The companies did not provide any additional clarity on specific changes they would like to see made to the provisions. Legislators had earlier updated the law to allow businesses with less than $1m in obligations to register with only a $500 licensing fee.

The firms also called for additional clarification to language meant to deal specifically with multi-signature wallet technology, whereby the control of funds in a bitcoin wallet can be shared by multiple parties.

"We strongly support the current use of 'full' to modify custody and control, and we seek clarification such that the definition of 'full custody' or 'control' is limited to unilateral uses," the authors wrote.

The letter ended on a more wide-reaching note, suggesting that California would be wise to communicate with the tech community as it works to bring new jobs and opportunities to state residents and job seekers.

Startup image via Shutterstock

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