Michigan could see the creation of a “Cryptocurrency Bill of Rights” under legislation recently introduced in the state House of Representatives.
One of the bills would keep the state and local governments from banning or restricting the ownership of cryptocurrencies, or taxing them any differently from regular currencies.
State Representative Bryan Posthumus (R-Rockford) said that bill and others would help Michigan attract the crypto industry to the state.
“Cryptocurrency is here to stay. I believe that 20 years from now, it’ll be the foundation of our entire financial industry. And Michigan can be a national leader in that effort,” Posthumus said.
Another part of the four-bill bipartisan package would create rules for investing state funds in cryptocurrencies.
Michigan has already invested in some crypto market-tied funds. That includes ones related to Bitcoin and Ethereum.
Posthumus said the bills would add guardrails by requiring currencies to have a market capitalization of at least $250 billion to be considered for investment. He said current law has few safeguards.
“We wanted to make sure that we passed legislation to make sure legally that the treasurer had the authority to do this. But also, that would protect taxpayers and pensioners,” Posthumus said.
Crypto markets have gained a reputation for being both potentially lucrative and volatile. That’s especially with the rise of so-called “meme coins” often based around internet jokes or trends. President Trump recently launched his own meme coin right before he was sworn back into office.
A final piece of the package would give Bitcoin miners the chance to use abandoned state-owned oil and natural gas wells. The process called “mining” for Bitcoin — solving what’s essentially a math problem that underlies the creation of a new coin — is extremely time consuming and energy intensive.
The bill would create a new program to let selected miners access those abandoned wells, as long as they cap and clean up the site when they’re done. Participants in the program could also get a tax break.
Posthumus said it would provide a new use for those abandoned mines that could otherwise leak methane, a potent greenhouse gas, into the environment.
“Our thought process was well why don’t we give the opportunity to bitcoin miners to bid on these abandoned oil wells with the expectation that, assuming they win the bid, they can … also be required to fund the remediation,” Posthumus said.