Interview with Rep. Tyler Lindholm and His Pro-Crypto Legislation
We got a chance to talk to Wyoming State Representative Tyler Lindholm about the crypto bills he successfully passed through their State Legislature recently.
As an avid crypto supporter, Lindholm sees cryptocurrencies and the technology behind them as something his state can support to encourage tech companies to come to his state. One of the Senate filings he supported in particular is even challenging how the United States views crypto assets.
You can watch the full interview above.
Lindholm first talked about the future of cryptocurrency legislation and his goal of helping make Wyoming a crypto hub for the United States.
“[Legislation] is going to be an evolving deal. Now that Wyoming has done it you are going to see a number of states follow up next year. And some states will still be in session till the May or June time period. I would look to possibly some of those passing it but most likely see quite a few run it next year in their home states. At that point, Wyoming will be running several new pieces of legislation that are blockchain related.
“You see states like Arizona who ran a bill where you can pay your taxes in cryptocurrencies…. That’s not going to attract businesses… We are looking at blockchain and digital currencies to attract businesses and crafting legislation in a statutory framework to that end and to that end only.
“We will make sure Wyoming is the best place for these blockchain companies and tech companies to land in the United States. Our biggest competitor right now is Switzerland”
Here is what Lindholm had to say about some of the bills Wyoming recently passed and the impact they will have on the state.
House Bill 19
Exempts cryptocurrencies from the Transmitters Act.
“House Bill number 19 is an answer to an issue that had kind of plagued Wyoming since about 2015 when the Wyoming Division of Banking decided to use the Wyoming Transmitters Act to regulate how cryptocurrencies are handled in the State of Wyoming. I will throw in the caveat that the Transmitters Act was originally was passed in 2002 when crypto currencies didn’t become a thing until early 2009 when Bitcoin was released by Satoshi. So that being the case it really wasn’t a very good answer to cryptocurrencies.
The act would have required exchanges to have one bitcoin and the federal reserve equivalent. After a couple of years we came up with legislation which exempts all virtual currencies from the Transmitters Act. That became law immediately with the signing of the governor.”
House bill 70
Differentiates between a security and utility ICO.
“There has been really no movement across the world on how to regulate these initial coin offerings. And indeed the United States doesn’t even know how to handle it. You look at the SEC and CFPC and they’re going in separate directions. They don’t know. Listening to Jay Clayton and his remarks specifically are pretty interesting. Just right off the bat he says “I don’t think I’ve ever seen an ICO that isn’t a security.
“Well if you look at the securities that he’s actually dealt with I think most people would agree. But, I do think it is of importance, and thankfully most of the Wyoming legislature does too, that we differentiate what is a security token or security ICO and what is a utility ICO.”
House Bill 101
Allows for the storage of corporate interoffice filings on the blockchain.
“House Bill 101 takes into account that it is 2018, technology is changing, and how do we account for that in the state of Wyoming. We require, much like many states, that certain documents and filing are keep by each and every corporation.
“One of those things that we were requiring of companies is that they keep interoffice filings such as shareholder names and address. Well it’s 2018. There are some corporations that don’t exist anywhere but online… So what we are saying now, if you so choose, you can put all of your inner office filings on a blockchain as a corporate entity. And why not. It’s immutable. Yet to be hacked. It’s safe. Its distributed. It’s decentralized. All the things that we really want when it comes to safe storage of data, blockchain has the ability to do.
“Pretty easy piece of legislation and not one vote against in the House or the Senate.”
House Bill 126
Allows a Limited Liability Company to establish series.
“House Bill 126 created Series LLCs. We are not the first in the United States to do this but Series LLCs do seem to be the favorite corporate filings for IOT companies and ICOs. Right now you can in any State create an LLC parallel to each other. You could have 20 or 100 LLCs all parallel. They would have to have different names they have different filings with extra paperwork. It’s just a way to spread out your liability from multiple different aspects of your businesses.
“What a series LLC does, instead of parallel, is creates it in a series like an electrical circuit. You have a mother LLC then you have daughter LLCs beneath it. So when it comes time for filing, all of those daughter LLCs aggregate under the mother so it’s just one fat filing fee.
“You will be able to go on the Secretary of State’s website for the State of Wyoming, create an LLC, and click the little check mark on how many series LLCs you want with it. It’s a $50 fee to and then you could create 500 series for example. For fifty bucks.”
Senate File 111
Exemps virtual currency from property taxes and defines virtual currency as legal tender.
“This ended up being the exemption from property taxes for virtual currency. This is a fascinating piece of legislation because it does something that nobody else has done and that defines virtual currency as being equal to other currencies.
“Basically, under our property tax statute, it says things the state can and can’t collect property taxes on. It clearly states that ‘money and cash on hand, including currency, gold, silver, and other coin, bank drafts, certified checks, cashier’s checks,’ can’t have taxes collected on them.
“Currently the united states government does not recognize virtual currencies as legal tender but as property. Hence why we say it is not direct property taxation.”
This is what was added to the income tax exemptions:
“…and virtual currency. As used in this subparagraph, “virtual currency” means any type of digital representation of value that:
( I ) Is used as a medium of exchange, unit of account or store of value; and
( II ) Is not recognized as legal tender by the United States Government.”
This is not to say the government isn’t after capital gains. But if you are a Wyoming resident you will not have to worry about the State collecting taxes off mining, transferring, or handling cryptocurrencies of any sort.
Wyoming is removing the question of if the state will decide to come after citizens for those taxes.
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Huge thank you to Rep. Tyler Lindholm for taking the time to talk about this legislation! Great to hear about what Wyoming is doing. We are especially excited to see how his work is picked up by other states and continues to push the adoption of crypto forward.
Tyler Lindholm’s Twitter: @Tyler_Lindholm