Texas Lawmaker Introduces Bill to Ban Anonymous Crypto Transactions

After failing to put proper regulatory rules, lawmakers around the world are now focusing on curbing the anonymity associated with digital assets. A member of the Texas House of Representative has recently introduced a bill to ban the anonymous use of Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term in the state.

In the bill number 4371, Republican member of the House Phil Stephenson proposed proper identification of the individuals sending or receiving cryptocurrencies. However, the bill clarifies that if a user is already using a “verified identity digital currency,” then there is no need to submit any identity verification to the state.

“[The user] not required to verify the identity of a person sending payment if the payment is sent by a verified identity digital currency,” the bill stated.

“[Texas] may not use a digital currency that is not a verified identity digital currency — The Texas Department of Banking, Credit Union Commission, Texas Department of Public Safety, and State Securities Board shall collaborate to encourage the use of verified identity digital currencies,” House Bill No. 4371 reads.

If passed, the proposals in the bill will come into effect from September 1, 2019.

Not Well Received by the Community

Stephenson’s move, however, was highly criticized by the crypto advocates in the state as well as in the country.

this #crypto bill in texas is scary.

— mfkon (@mfkonn) March 11, 2019

Mentioning the bill, Andrew Hinkes, co-founder and general counsel of Athena Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term, raised a few critical questions: “Would any existing cryptocurrency or digital currency qualify as a ‘verified identity digital currency’ as defined? What level of ‘ID’ is required to be ‘verified’? State issued? Are four state administrative bodies the right entities to ‘promote’ a digital currency?”

Congratulations #Texas, you're the first state to formally attack and attempt to ban anonymous use of #cryptocurrency in the US. https://t.co/KHaPgQiq5H

— Drew Hinkes (@propelforward) March 10, 2019

Is Anonymity Good or Bad?

Texas is not alone to attack the privacy of the digital currencies as recently the Finance Committee of France’s National Assembly, in a report elaborating the use of crypto assets and the blockchain technology, proposed a complete ban on the privacy-oriented cryptocurrencies like Monero and Zcash.

Earlier in January, Finance Magnates reported that Texas is considering the mandate licensing for issuing the dollar-pegged stablecoins.