North Carolina House Moves Forward With Legislation to Research Bitcoin and Virtual Currencies
The North Carolina House of Representatives has approved House Bill 721 to research the benefits and acquisition of Bitcoin and virtual currencies. The bill, now referred to the Senate, aims to investigate state-level virtual currency management.
The proposed law acknowledges the increasing significance of Bitcoin and virtual currencies, as stated in G.S. 53-208.42(20), and suggests an assessment of its possible effects on the state’s financial strategy.
The study proposed in the legislation will examine the prospective benefits of assigning a segment of the General Fund to virtual currency. This is intended to act as a hedge against inflation and systemic credit threats, decrease portfolio volatility, and increase portfolio yields.
The inclusion of terms related to the study of virtual currency, specifically mentioning Bitcoin, came after Dan Spuller, the North Carolina Blockchain Initiative's Director of Industry Affairs, testified in front of the North Carolina House Standing Committee representing the Initiative.
Spuller emphasized in a following tweet that this move is part of multiple pro-Bitcoin efforts the Initiative is championing in the state. The decision to add this language to the bill was met with unanimous approval.
Apart from investigating potential advantages of virtual currencies like Bitcoin, the bill also underscores the necessity of evaluating the advantages, costs, and security protocols tied to diverse depository choices.
The study will look into the feasibility of using a privately-operated depository, a depository managed by another state, or instituting a State-managed depository within North Carolina.
The end goal is to determine the most appropriate entity for custodianship, guardianship, and administration of the state's virtual currency assets, including those owned by its agencies, political subdivisions, or other entities.
The bill states:
The expected impact of allocating a portion of the General Fund to virtual currency to hedge against inflation and systemic credit risks, reduce overall portfolio volatility, and increase portfolio returns over time.