Crypto in Utah Undergoing Regulatory Scrutiny

Since authorities finding of a fully remote decentralized, solar-powered, Helium blockchain network in Utah’s Salt Lake City’s foothills, the state has been fairly prevalent in crypto headlines.

The SEC announced on Thursday that it had obtained an asset freeze and restraining order against an Utah blockchain called DEBT Box. According to its website, DEBT Box is a “decentralized, eco-friendly, blockchain technology project.”

The SEC charged the city of Draper, Utah-based DEBT Box, as well as the company’s four principals and 13 other defendants, with operating a scheme that began in March 2021 to sell unregistered securities called “node licenses.” Defendants told investors that the licenses would mine cryptocurrency that would increase in value, when in reality, defendants were creating the crypto instantaneously using code on a blockchain, according to the SEC.

Also in Utah, a microgrid company in Woods Cross, Utah is using traditional grid with solar, wind, fuel cell, and other green technologies to balance load requirements among various sources in an effort to assure clean energy at a good price.

Microgrids might be a practical answer to concerns about the source of energy used in Bitcoin mining. This specific company, CleanSpark, who is also a Bitcoin miner, recently invested in new energy-efficient equipment to boost its hash rate and cut electrical usage.

Over the last year, Utah signed three new bills into law that deal with cryptocurrency. HB 335, which creates the Blockchain and Digital Innovation Task Force. HB 456, which requires the Division of Finance to contract with a third party in order to accept payments in the form of digital assets. This bill “authorizes the Division of Finance to contract with a third party to accept payments to political subdivisions in the form of digital assets”.

Finally, the third bill, SB 182, establishes a framework of ownership for digital access. This creates a secure, private right for owners over digital transactions.

Blockchain, the underlying technology that many cryptocurrencies operate on, is still relatively new technology. This is why many states are creating their own Digital Task Forces in order to better understand it and be able to set policies.

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