Louisiana is setting up a committee to determine whether the state should wade into the world of cryptocurrency.
State Rep. Mark Wright, a Republican from Covington, authored House Concurrent Resolution 103, which would direct the Cash Management Review Board to set up a committee to research ways the state can use cryptocurrency and blockchain technology.
The House Appropriations Committee heard Wright's resolution Monday and reported it favorably with no objections. The concurrent resolution will need to be approved by the full house and the senate.
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"Essentially we're going to look at things like the state taking payments in cryptocurrency or digital payments," Wright said to the committee. "There's a lot of things related to this."
Wright has filed another bill related to cryptocurrency, House Bill 170, which would allow political candidates in Louisiana to take cryptocurrency for campaign contributions. That bill is awaiting a hearing in the House and Governmental Affairs Committee.
In February, Colorado Gov. Jared Polis announced that his state would be the first to begin accepting cryptocurrency as payment for state taxes and fees. It's been a hot topic of discussion in other state legislatures across the country, particularly in the western U.S.
The resolution would have the Cash Management Review Board meet as the "Louisiana Digital Assets Working Group" to research how the state could make use of the growing technology. The committee would have to submit its findings and recommendations to the Louisiana state treasurer by Feb. 1, 2023.
In the resolution, Wright says that cryptocurrency is a growing form of exchange both in Louisiana and across the country. By putting together a group of professionals to look at cryptocurrency, Louisiana could become "a trailblazer in this quickly-emerging digital space," the resolution says.
Specifically, the Louisiana Digital Assets Working Group would be tasked with looking at how the state could use digital assets, along with a legal regulatory framework for cryptocurrencies. In addition, the group will look at ways to improve the business climate for technology firms, particularly financial technology firms.
The group will also put together an advisory board of financial technologies experts. The group would also be directed to look at the work done by the Lafayette Public Innovation Alliance, a group created by the then-Lafayette City-Parish Council to look at growing the local technology economy.
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Cryptocurrency has gained popularity in recent years largely due to its decentralized structure and the anonymity afforded by using digital assets. Many celebrities and business leaders have also begun using cryptocurrencies.
"There are a lot of different areas related to this, like the mining with our energy sources," Wright said. "Of course, the consumer aspect as well."
Cryptocurrency mining usually refers to the act of verifying transactions in exchange for some of the currency. This practice has drawn criticism for the amount of electricity required to mass-mine some types of currency, such as Bitcoin. Business Insider reported that Bitcoin mining creates 40 million pounds of carbon emissions in the U.S.
The cryptocurrency market is coming off a volatile week, where Bitcoin lost around 19% of its value.