The U.S. state of Vermont could soon be adopting blockchain technology to handle some of its public records, according to a bill signed by Gov. Phil Scott.
The study is part of a comprehensive investigation into the state’s potential support and adoption of blockchain technology, a push that originated with the introduction of S-0269 into the state Legislature by Sen. Alison Clarkson in January.
By Jan. 15, the Vermont State Archives and Records Administration, the Vermont League of Cities and Towns, the Vermont Municipal Clerks’ and Treasurers’ Association, and the Agency of Digital Services are required to submit a report and recommended legislation concerning blockchain use to the relevant state legislative committees.
Specifically, the groups must “evaluate blockchain technology for the systematic and efficient management of public records” and “recommend legislation, including uniform laws, necessary to support the possible use of blockchain technology for the recording of land records.”
Vermont’s potential adoption of blockchain technology for its internal use is just one facet of the state’s relatively friendly attitude toward cryptocurrencies.
The same bill creates regulatory and registration standards for blockchain companies operating as personal information companies. It also directs the Department of Financial Regulation to “review the potential application of blockchain technology to the provision of insurance and banking and consider areas for potential adoption and any necessary regulatory changes in Vermont.”
The bill further authorizes the Agency of Commerce and Community Development to hold a fintech summit concerning blockchain technology. It also directs the agency to roll blockchain marketing materials into its existing programs.
Per the language of the bill, the agency should identify “opportunities to promote blockchain technology and financial technology” and “related economic development in the private sector, including in the areas of banking, insurance, retail and service businesses, and cryptocurrency.”
Vermont’s inroads into cryptocurrency echo and expand upon measures being taken in other states. Following the examples set by Arizona and Tennessee, state Legislatures in Ohio and New York are considering updates to their laws regarding blockchain technology.
The primary issue is the definition of a smart contract as it pertains to the state-level version of the Uniform Electronic Transaction Act. The act – which was written in 1999 and has been adopted in 47 states – creates parity between paper and electronic transactions.
Including blockchain technology and its smart contracts in the language of each state’s version of the act would pave the road for more coherent regulation and eventual adoption.
Both the Ohio and New York bills use the same language to describe smart contracts as the bills passed in Arizona and Tennessee.
The term “blockchain technology” therein means “distributed ledger technology that uses a distributed, decentralized, shared, and replicated ledger, which may be public or private, permissioned or permissionless, or driven by tokenized crypto economics or tokenless.”
Moreover, blockchain data must be signed cryptographically, making it immutable, auditable, and a record of “uncensored truth,” the bills state.