Written by: Yangz, Techub News
Last night, Wyoming announced the launch of the Frontier (FRNT), a stablecoin backed by the US dollar and short-term government bonds, becoming the first state in the US to issue a stablecoin. This marks a substantial achievement in the state's exploration of stablecoins that began in 2023. This move further confirms the "Cowboy State," with a population of less than 600,000, as a leader in cryptocurrency legislation and practice.
From excluding utility tokens from securities regulation to establishing legislation for DAO LLCs and DUNE structures; from passing private key protection laws to attracting industry giants like Kraken to relocate their headquarters, what gives Wyoming such magic? Before attempting to answer this question, let's briefly review some key cryptocurrency legislation in the state.
Legislative Cornerstone: Overview of Key Cryptocurrency Legislation in Wyoming
Wyoming Governor Mark Gordon stated that since 2016, the state has passed over 45 pieces of legislation related to cryptocurrency. Here are some key pieces of cryptocurrency legislation from the state:
HB 19 (2018): Provides a specific exemption framework for funding transmission licenses for virtual currency activities.
HB 70 (2018): Excludes utility tokens from securities regulation.
SF 111 (2018): Exempts virtual currency from property tax, making Wyoming an ideal place for cryptocurrency investment.
SF 125 (2019): Classifies digital assets into digital consumer assets, digital securities, and virtual currencies at the state law level.
HB 74 (2019): Creates a framework for special purpose banks to provide custody/settlement services for digital assets.
HB 185 (2019): Allows for the registration and transfer of stock certificates in a tokenized form under corporate law.
HB 57 (2019): Provides a sandbox mechanism for limited pilot and regulatory exemptions for blockchain/crypto-related innovative businesses.
SF 38 (2021): Recognizes and regulates the establishment, governance, and member rights and responsibilities of DAOs under the LLC system.
SF 127 (2023): Establishes the Wyoming Stable Token Committee, authorized to issue state-level stablecoins backed by the US dollar.
HB 86 (2023): Prohibits the mandatory disclosure of private encryption keys, ensuring the security of investors' assets.
SF 50 (2024): Establishes decentralized, non-profit autonomous protocol organizations (DUNA) as independent legal entities.
HB 308 (2025): Authorizes the state attorney general to investigate and potentially intervene in federal overreach regarding blockchain and cryptocurrency-related activities, protecting the rights of residents and businesses in the state.
The above is just a glimpse of Wyoming's cryptocurrency legislation and practice. However, whether from the density of legislation or its forward-looking nature, the state truly deserves the title of "America's cryptocurrency legislative testing ground."
So, what factors are driving this small western state to continue leading in the field of crypto assets?
Key Factors for the "Cowboy State" to Maintain Its Lead
In my view, Wyoming's ability to maintain its lead in the field of crypto assets is closely related to its urgent need for industrial transformation, its libertarian cultural genes, its flexible legislative mechanisms, and the drive of visionary policymakers. These factors intertwine and reinforce each other, collectively forging the state's unique core advantages in the cryptocurrency race.
Industrial Diversification and Economic Transformation Needs
As the largest coal-producing state in the US and an important source of oil and natural gas, energy extraction and its related industries (such as transportation and support services) have long been the main sources of tax revenue, government budgets, and employment in Wyoming. However, this pillar industry clearly faces challenges from environmental policies and fluctuations in energy prices. To address this, the state government has actively promoted the development of digital assets and blockchain technology since 2016, attracting a large number of cryptocurrency companies and tech talent through a clear regulatory framework. In June of this year, Kraken announced it would relocate its headquarters from San Francisco to Cheyenne, Wyoming, calling this move a "commitment to domestic cryptocurrency innovation in the US."
Libertarian Cultural Genes
Wyoming is known as the "Cowboy State" of the American West, with its cultural bloodline deeply engraved with the imprint of libertarianism. This spirit originates from the early western pioneering tradition, which values self-reliance, individualism, and absolute respect for private property. On the vast lands of the state, historical ranchers, prospectors, and pioneers relied on autonomy and self-sufficiency rather than external intervention.
This cultural gene continues to this day, profoundly influencing Wyoming's attitude towards finance and technology. The public generally pursues economic autonomy and holds a cautious stance towards the highly centralized traditional financial system. The cryptocurrency advocacy of "Be your own bank" and the idea of breaking free from intermediary control find a natural cultural resonance here.
Legal Innovation Genes and Flexible, Efficient Legislative Characteristics
As I previously mentioned in the article "Uniswap Proposes to Establish DUNA Entities, DAO Compliance Process Once Again Embarks on an Exploratory Stage," Wyoming has a deep-rooted legal innovation gene. As early as 1977, the state was the first in the nation to pass the Limited Liability Company Act (LLC Act), providing a flexible and liability-limited business entity form for small and medium-sized enterprises. Additionally, Wyoming was the first state to adopt the "Unincorporated Nonprofit Association" (UNA) system. These pioneering measures not only influenced legislation in other states but also laid the groundwork for the state's exploration in the fields of digital assets and decentralized organizations.
Moreover, as the least populated state in the US, the process from proposal to passage of bills is much quicker than in more populous states with complex interest groups (such as California or New York). This advantage also makes the state an ideal "testing ground," where even if a policy encounters issues, adjustments can be made relatively easily, and risks are manageable.
Visionary Policy Advocates
Any institutional change relies on key individuals' advocacy. Wyoming's ability to stand out in cryptocurrency legislation and practice is also due to a group of core advocates with deep expertise, significant political influence, and a strong forward-looking policy vision.
First, Governor Mark Gordon has long supported blockchain innovation, promoting the establishment of the stablecoin committee and related projects, providing institutional guarantees for the state government's direct participation in the digital asset field.
Second, Cynthia Lummis, known as the "cryptocurrency advocate on Capitol Hill," hails from Wyoming. She is not only an early Bitcoin investor but also, as the chair of the Senate Banking Committee's digital asset subgroup, continues to promote rational and innovative cryptocurrency regulatory policies at the federal level. In July 2024, she proposed the Bitcoin Act, advocating for the US government to accumulate 1 million Bitcoins as a strategic reserve within five years, demonstrating profound consideration for the national digital currency strategy.
Additionally, Caitlin Long, founder of Custodia Bank, has played an irreplaceable role as a key figure in Wyoming's blockchain legislation. In 2017, she co-founded the Wyoming Blockchain Coalition, focusing on industry advocacy and public education. In 2018, she was appointed a member of the state blockchain task force, directly leading the drafting and promotion of over 20 key laws, profoundly shaping the state's legislative framework. At the end of 2019, she resigned from her government position and founded Custodia Bank, continuing to expand her practice in the crypto banking field, becoming a key figure connecting policy-making and business innovation.
From state to federal, from legislation to industry, the continuous efforts of policymakers represented by Mark Gordon, Cynthia Lummis, and Caitlin Long have gradually transformed Wyoming's vision for the digital frontier into a leading advantage in reality.
Conclusion
As David Pope, a member of the Wyoming Stable Token Committee, stated, launching a state stablecoin is like "throwing a stone into a vast pond—the ripples will spread, reshaping every corner of finance, not only changing the appearance of one state but also impacting the financial landscape of the entire country and even the world." This small western state has taken the lead in charting its own course in the trend of cryptocurrency compliance. Its successful practices provide a replicable paradigm for other regions and demonstrate to the world that in an era of change, the courage to act is far more valuable than continuous observation.
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