U.S. crypto exchange and wallet provider Coinbase has been given the green light from regulators to resume its services in the state of Wyoming, according to an official announcement published August 3.
The exchange has now reportedly successfully renewed its money transmitter license in the state of Wyoming. The license had been suspended as of mid-2014 due to stipulations in state law that required all exchanges to “double reserve” the digital assets of state residents with fiat currency.
As Coinbase outlined at the time, the exchange had chosen to suspend its services as soon as its operations as a cryptocurrency exchange were deemed by legislators to fall subject to certain conditions for licensure stipulated under the Wyoming Money Transmitters Act (specifically, Chapter 22 of Title 40 – Trade and Commerce, which was introduced in the Wyoming Statutes of 2011 and came into effect by 2014).
According to Coinbase, the Act had hitherto been interpreted by the Wyoming Division of Banking as requiring “licensees [to] maintain dedicated fiat currency reserves in amount equal to the aggregate face value of all bitcoin [sic.] held on behalf of customers,” something the exchange found to be “impractical, costly, and inefficient.”
Having now resumed its services for Wyoming residents, Coinbase credits the state legislature, Governor Matt Mead and members of the Blockchain Task Force with enabling a new bill to be signed into state law that has now effectively removed these restrictions.
House Bill 19 regarding the exemption of virtual currencies from the Wyoming Money Transmitter Act was passed with a majority of 28-3 by the Wyoming state legislature on March 5 of this year, allowing Coinbase to apply for a license under which it can resume operations as a compliant and regulated exchange.
Alongside House Bill 19, Wyoming has also this March passed House Bill 70 that exempts certain blockchain tokens from securities regulations and money transmission laws, as well as passing a further cryptocurrency related bill, Senate Bill 111, in February that exempts virtual currencies from state property taxation.