The News: California Governor Gavin Newsom issued an executive order recently regarding development of blockchain and crypto regulations for the state. The order aims to build a regulatory framework and infrastructure for blockchain and crypto businesses in the state that both fosters development of those industries and protects consumers. Read reporting from The Wall Street Journal here.
Blockchain, Crypto Regulations in California Foster Development and Protect Consumers
Analyst Take: A recent executive order issued by Gavin Newsom addresses the need for blockchain and crypto regulations in California, making the state the first in the nation to begin creating comprehensive guidelines for those industries. Newsom’s goal for the forthcoming crypto regulations is twofold: to foster the development of blockchain and cryptocurrency businesses, and to protect consumers. California’s reputation as a home for innovative and emerging industries was reinforced in statements surrounding the order, which has been praised by industry groups.
While blockchain and crypto regulations weren’t specified, the order calls for the institution of a regulatory framework, implementation of the technology within public institutions in the state, and a plan to create research and workforce-development infrastructure. New York and Wyoming have already crafted laws addressing blockchain and crypto regulations, but California’s approach appears to more broadly address the potential opportunities and challenges posed by the technologies. A March executive order from President Biden directed federal agencies to review cryptocurrencies, and Newsom’s order acknowledges the need for consistency between state and federal regulations as they arise.
Crypto Regulations Establish California’s Primacy in Industry
Silicon Valley has been a hotspot for blockchain and cryptocurrency development since the early days of those global industries. As emerging fields that receive substantial investment and create a lot of jobs, it’s wise for Newsom to take the lead in crafting a regulatory framework that encourages blockchain and crypto industry presence in California. By laying a foundation for the productive growth of those industries through crypto regulations, the order can serve to establish the state’s leadership and investment in the field.
California’s approach to blockchain and crypto regulations includes the institution of several consumer protections, including the production of educational materials geared toward helping residents stay informed of the benefits and risks associated with cryptocurrencies and avoid scams and frauds. Newsom is smart to acknowledge the major concerns surrounding cryptocurrencies in his bid to bolster the development of the industry in his state. It’s a balanced approach that has both consumers and industry groups lauding the executive order. Regulatory frameworks like those forthcoming in California provide guardrails that can accelerate development while protecting consumers – I’m looking forward to following the story as the state’s crypto regulations take shape.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum Research as a whole.
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A serial entrepreneur with a technology centric focus, Shelly has worked with some of the world’s largest brands to lead them into the digital space, embrace disruption, understand the reality of the connected customer, and help navigate the process of Digital Transformation. Read Full Bio.