Louisiana, a state in the United States, has made changes to its laws to prohibit the use of central bank digital currencies (CBDCs) and establish regulations for miners and node operators. The updated legislation will take effect in August 2024.
The revisions, known as the Blockchain Basics Act, prevent Louisiana from participating in CBDC tests and from accepting or requiring payments using CBDCs. However, the law does not prohibit the use of other digital currencies. The act states, “A governing authority shall not participate in any test of central bank digital currency by the Board of Governor.”
Louisiana is also imposing strict controls on foreign-owned digital asset mining companies. The state’s legislation forbids foreign entities from acquiring or maintaining any stake in digital asset mining operations within Louisiana.
Starting from August 1, 2024, foreign-controlled businesses currently involved in digital asset mining in Louisiana will have one year to completely divest their interests. Noncompliance with the law can result in significant penalties, which may amount to $1 million or 25% of the foreign party’s stake in the mining operation.
The revised legislation in Louisiana provides a definition for node operators and clarifies their role in a network. It states that while nodes play a crucial part in maintaining a blockchain, they do not have the authority to alter or determine the outcome of transactions initiated by users. According to the act, a node is a computational device that communicates with other devices or participants on a blockchain to ensure consensus and integrity, as well as create and validate transaction blocks.
The future of a digital dollar in the United States is becoming increasingly uncertain. Like Louisiana, other states such as Florida and North Carolina have taken legislative measures to restrict or ban the use of CBDCs.
Presidential candidates also hold differing views on CBDCs. Donald Trump has expressed opposition, citing concerns about government overreach and increased surveillance. In contrast, the Biden administration seems more open to exploring the potential of CBDCs. However, it has faced opposition from several U.S. senators who are seeking to ban the introduction of a digital dollar in the country.
According to the Cointelegraph Research database, 110 countries around the world are actively exploring or developing CBDCs. Of these, 39 have progressed to more advanced stages, such as piloting or launching CBDC initiatives.
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