Wyoming became the first state in the nation Tuesday to launch its own digital currency, a stable token that is backed by the U.S. dollar and short-term U.S. Treasury bills.
Using token issuance partner LayerZero, the Frontier Stable Token will soon be available on the Ethereum, Solana, Avalanche, Polygon, Arbitrum, Optimism and Base blockchain networks.
Buyers will get access to the token through Wyoming-based digital asset exchange Kraken in the coming days.
The Wyoming Stable Token Commission reported that the blockchain-based stable token offers the means to make “secure, transparent and efficient digital transactions” worldwide.
Gov. Mark Gordon, chairman of the Wyoming Stable Token Commission, said the launch is the result of years of effort and work from manypeople.
“For years, Wyoming has been the leading state on blockchain, cryptocurrency, and digital asset regulation, passing over 45 pieces of legislation since 2016,” Gordon said. “Today, Wyoming reaffirms its commitment to financial innovation and consumer protection.
“The mainnet launch of the Frontier Stable Token will empower our citizens and businesses with a modern, efficient, and secure means of transacting in the digital age.”
David Pope, a Cheyenne-based accountant who serves on the Wyoming Select Committee on Blockchain and Wyoming Stable Token Commission, said his own perspective on the rollout is that it’s a “huge day.”
‘Ripples’ Spreading Out
“This is a stone that we have cast into a really huge pond, and the ripples are going to spread out and affect everything financially that we know, not just as a state, but as a nation and throughout the world,” Pope said about the significance of Wyoming being the first state to have its own stablecoin.
With the stable token, which represents the right to a $1 bill, people will be able to use it through a digital wallet just like any other payment method.
Money used to buy Frontier Stable Tokens will be used solely for investment in treasuries; it will not be used by the state for any other purpose. The interest that accrues from the treasuries will be held in the trust account until there’s at least 102% of the value of all tokens held on reserve.
That way, there will always be enough excess cash on hand to redeemFrontier tokens.
Interest accumulated by the state from the purchase of securities related to the tokens will go toward the state’s school foundation program, and be distributed on a quarterly basis.
Pope said what stablecoins have done in the world is reduce settlements and transfers of currency for transactions from something that takes days to mere minutes, whether between nations, businesses or individuals.
With Wyoming’s Frontier Stable Token backed by U.S. Treasury bills, as required by state statute, users know that the token is financially sound and secure to use, Pope said.
That is different from private companies that issue their own digital tokens and coins and are only bound by market risk when they create their reserves.
He also compared the stable token issuance to the launch of smartphones years ago which allowed for third-party applications to be developed and used in myriad ways.
Wyoming’s new stable token will “allow for a million third-party people to create new ways to pay and new payment systems to use.”
“Pushing this out to the marketplace … we already have a tremendous amount of interest in using it as a means of really fast and really efficient settlement,” Pope added.
Pope said it is important for people to remember that the stable token is not a “currency” because states under the U.S. Constitution cannot create a currency; instead, the token is a “right” to access $1.
‘Leading The Nation’
U.S. Sen. Cynthia Lummis, R-Wyoming, who helped spearhead stablecoin legislation called the GENIUS Act through Congress earlier this year, applauded the state’s action.
“For nearly a decade, Wyoming has been at the forefront of digital asset innovation,” she said. “The launch of Wyoming’s stablecoin is yet another reason the Cowboy State is leading the nation when it comes to digital assets, and I applaud our state’s continued commitment to supporting this vital industry.”
The Wyoming Stable Token Commission, led by Executive Director Anthony Apollo, has been at work on fine-tuning the launch since being given a $5.8 million budget by the Wyoming Legislature for the two-year period of July 1, 2024, through June 30, 2026.
Advantages to using the state’s stable token include its ability to be sent to anyone in the world as long as they have an internet connection.
There is no intermediary in the transaction, the token can be sent directly from sender to recipient.
All transactions are “immutable” and cannot be altered and are auditable, meaning there is a record of the transaction, according to the state’s stable token website, stabletoken.wyo.gov
Dale Killingbeck can be reached at dale@cowboystatedaily.com.