Towards a regulatory framework for blockchain and cryptocurrencies in California

The state governor recently signed a blockchain executive order to spur innovation and protect consumers.

California is interested in the web3. On May 4, Gavin Newsom, the governor of the state, signed an executive order regarding blockchain. Goal: To create a transparent regulatory and business environment for web3 businesses, balancing consumer benefits and risks and incorporating California values ​​such as equity, inclusiveness and environmental protection.

California will thus begin to create a regulatory approach to stimulate responsible innovation and protect consumers, but also to evaluate ways to implement blockchain for the state and public institutions. It will also create pathways for workforce research and development to enable Californians to be successful in this industry. “Too often, the government lags behind in technological advancements, so we are leading the curve on that, setting the stage for consumer and business growth.”Gavin Newsom explained.

Between innovation and regulation

Building on the cryptocurrency executive order signed by President Joe Biden last March, the governor’s executive order calls on state agencies to work together to gather stakeholder feedback for potential blockchain companies and applications. . This includes, inter alia, stakeholders in this technology and cryptocurrencies as a means of addressing systemic inequalities and those concerned about potential negative effects, including energy consumption and environmental impact. State agencies will need to pay special attention to cryptocurrencies and related fintech.

The executive order also orders the Department of Financial Protection and Innovation (DFPI) to define a regulatory approach to cryptocurrencies, create consumer protections, and educate Californians about the benefits and risks associated with cryptocurrency-related products and services. To do this, it will have to produce educational content that includes, in particular, “Information on how to avoid scams and frauds”which is a major concern with cryptocurrencies.

State agencies are also tasked with exploring opportunities to implement blockchain technologies to meet emerging and public service needs. This could include applications in the private sector, academia and the community. Finally, as part of the decree, research and workflows should be created to fuel innovation in the blockchain, including cryptocurrencies. “The goals will be to expose students to emerging opportunities, promote emerging industries and help ensure that economic benefits are lived out fairly.”indicates the document.

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