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Louisiana signs bill to ban CBDCs, protect right to self-custody, and mine cryptocurrencies
Louisiana Governor Jeff Landry has signed a bill to ban central bank digital currencies (CBDCs) and protect cryptocurrency mining on June 19th.
The bill, HB 488, prevents government authorities from accepting or requesting payments in CBDCs. It also prevents authorities from participating in CBDC testing conducted by the Board of Governors of the Federal Reserve and other federal government bodies.
It grants individuals and businesses the ability to accept cryptocurrencies for legal goods and services and to independently store cryptocurrencies in unattended and hardware wallets.
The rest of the bill describes the rules related to crypto mining and the operation of nodes. Protects domestic crypto mining in compliance with local noise ordinances. Allows commercial crypto mining in industrial areas in compliance with all ordinances.
According to the law, operating a node to connect to a blockchain protocol or sub-protocol, transferring cryptocurrencies on the protocol, and staking on the protocol are legal.
The Louisiana Attorney General can take action against fraud and other violations related to mining and staking as a service. Participants must also comply with federal and state securities laws.
The bill also bars prohibited foreign entities from controlling digital mining operations and requires existing parties to divest by August 2025. Prohibited foreign parties that fail to comply face civil penalties of up to $1 million or 25 percent of the foreign party’s interest in the operation.
The bill amends existing law and will come into force on August 1.
The efforts of other states
Other states have introduced laws addressing the same issues. In MayOklahoma’s governor signed a law protecting cryptocurrency miners and self-custody of cryptocurrencies. The same month, Montana Gov signed an invoice prohibit local governments from banning mining.
Arkansas he signed two invoices in May, imposing or allowing restrictions on cryptocurrency mining following the success of a more lenient bill in 2023.
Separately, several states are addressing the possibility of a CBDC. Ledger Insights said in February that 11 states had pending legislation on the matter, blocking state acceptance of CBDC, rejecting CBDC as money, blocking participation in state trials, or taking another approach.
At the federal level, the U.S. House passed a bill prevent the Federal Reserve from creating and issuing a CBDC without congressional approval. The Senate will now have to consider the bill.