Everything’s bigger in Texas, and it seems that includes cryptocurrency regulations. A new bill is making its way through the Lone Star State’s legislature, aimed squarely at digital asset service providers. 👁️
Bill 88(R) HB 1666, dubbed the “Digital Asset Service Providers” bill, aims to tighten the reins on these companies. Let’s break down the key points of this proposed legislation.
- Separating Funds: Commingling Prohibition
The bill prohibits digital asset service providers from commingling customer funds with their own, including operating capital, proprietary accounts, digital assets, fiat currency, or other non-customer property. The goal is to ensure customer funds are kept separate and secure, protecting them from potential misuse.
- Who’s Affected? Defining the Scope
Bill 88(R) HB 1666 applies to digital asset service providers operating in Texas that hold a money transmission license and serve more than 500 digital asset customers in the state or have at least $10 million in customer funds. Banks and entities exempted by the Finance Commission of Texas or the Texas Department of Banking are not subject to this bill. 🏦
- Administration: The Texas Department of Banking Steps In
The Texas Department of Banking is tasked with administering the regulations laid out in the bill, ensuring compliance among affected digital asset service providers.
- The Road to Becoming Law: Navigating the Legislative Process
While the bill has been introduced and the House Committee Report version has been presented, it still has a long way to go before becoming law. It must pass both houses of the Texas legislature and be signed by the governor before it takes effect.
TL;DR – Texas is looking to tighten its grip on digital asset service providers. By prohibiting the commingling of funds and ensuring customer assets are safeguarded, Texas aims to bolster consumer protection. As the bill progresses through the legislative process, crypto firms operating in the Lone Star State will be watching closely. 🕵️♂️