Cryptocurrency industry suffers a lot from a lack of legal regulation and constant witch-hunt for money-laundering practices from the side of the governmental authorities. China installed
a ban on mining operations. Great Britain and the State of New York restricted Binance in its local services and the EU passed a law recently prohibiting anonymous transactions in cryptocurrency. However there is good news coming from the most unexpected places. For example, El-Salvador’s full legalization of any crypto-related activity. Speaking of which, North America paves the way with the light at the end of the tunnel coming from Wyoming.
Wyoming ratifies a set of laws targeting crypto industry
Cailtin Long, the founder and CEO of Avanti Bank & Trust became a crypto enthusiast back in 2012 appreciating the speed of financial transactions powered by blockchain and attempted to endow a scholarship for female engineers at the University of Wyoming using Bitcoin but found the school wasn’t able to accept the donation because Wyoming laws barred the operation of crypto exchanges in the state back in 2017. Since then she voluntarily joined the government-led Wyoming Blockchain Taskforce and with her encouragement, Wyoming would enact 24 laws designed to lure cryptocurrency companies into a state with exceptionally cheap energy prices but only 579,000 residents. Those laws admit cryptocurrency as money in the state, along with enabling banks to serve as the custodians of digital assets and accepting mining companies operations and providing further advocacy of Bitcoin’s carbon footprint. Such laws already provide visible benefits for the state’s economy and attract big profile crypto companies to Wyoming’s capital city of Cheyenne, including crypto exchange company Kraken moving its operations in February, 2019 (valued at $4 billion), blockchain platform Cardano (market capitalization of $18 billion) and payment protocol firm Ripple Labs relocating in December, 2019 (valued at $10 billion).
Wyoming is at the forefront of regulation process
Already established legal infrastructure enabling crypto companies to operate freely on the territory of state provides further progression for their legal advancements. The main discovery of 2020, the Decentralized Finance industry, attracts more and more users to its services in a rapid way, however this industry suffers from a lack of regulation as much as the centralized crypto companies do. Decentralized Finance paved a way for Decentralized Autonomous Organizations or DAO. A DAO is any community that uses blockchain to govern itself without the intervention of a central authority. American CryptoFed’s mission, for instance, is to “create and sustain a monetary system with zero inflation, zero deflation, and zero transaction costs.” Since DAO is an emerging term it is completely outside the scope of the legal field globally. However, this is not the case for Wyoming, since they already have cryptocurrency-related laws. On July 1, 2021 Wyoming enacted into power the law officially recognizing DAO, it’s latest step to becoming the country’s most crypto-friendly place to work and live. That law recognizes DAO as a distinct form of limited liability company (LLC) providing legal protection for decentralized communities. That law was backed by the Secretary of State, Edward Buchanan, along with the Merchant Advisory Group (MAG), representing 165 of the largest merchants in the US. With such laws, the state’s government sees a huge potential for economic growth and new job opportunities created inside the state.
Decentralized Finance is heading to Wyoming
Centralized blockchain organizations all over the world suffer a lot from unexpected turns of the governmental regulation wheel with drastic bans installed leading to increased costs in operations and money spent on the relocation of organizations. If that is the case for centralized crypto communities with established offices and servers, how does it affect decentralized organizations? At the moment there is no direct effect, but the experts attempt to foresee that moment, when the government will head their way.
Also Read: Blockchain From A Security Perspective
Since the emergence of DeFi it’s becoming obvious that this industry already learned from the mistakes of the earlier players of the crypto industry doing its best in order to comply with the authority’s regulations. One of the leading DeFi protocols, Nimbus, strictly follows the rules and regulations in order to be as transparent and secure as possible. That’s why they are going to establish a DAO legal entity in Wyoming, as the state now recognizes DAO as a form of LLC.
Nimbus platform is a DAO-governed ecosystem aimed at establishing All-in-One decentralized financial services. Nimbus platform offers a wide range of products and services, all in the form of dApps executed by smart contracts. It’s services include swap machine, staking, P2P exchange, lending and borrowing mechanisms all in the same place enabling full-scale user experience and providing high-profit and at the same time less risky investment opportunities for users. Nimbus provides a full range of banking services, while eliminating the intermediaries and establishing full transparency and security, since it’s services are based on smart contracts implementation leading to a clear automation of transactions. Since they are trying to revolutionize classical banking and financial services, it is vital to comply with the authorities in order to install trustworthy and transparent user experience. That’s why Wyoming is the landmark targeted by Nimbus as the most-friendly and warm-welcoming place to found a legal decentralized entity.