Legislation has been introduced in the US state of South Dakota to amend the Uniform Commercial Code (UCC) to narrow the definition of money to exclude cryptocurrencies. Central bank digital currencies (CBDCs) would still be considered money under the proposed new definition.
The 117-page amendment, introduced in the state House of Representatives by Republican Mike Stevens, define “money” as “a medium of exchange currently authorized or adopted by a national or foreign government”. The term includes a monetary unit of account established by an intergovernmental organization or by agreement between two or more countries.” The bill continued:
“The term does not include an electronic record that is a medium of exchange registered and transferable in a system that existed and operated for the medium of exchange before the medium of exchange was authorized or adopted by the government.”
Notably, CBDC falls under the proposed definition of money, unlike cryptocurrency. It received a strong reaction from the head of the conservative State Freedom Caucasus Network, Andy Roth.
Related: US CBDC Would ‘Displace’ Crypto Ecosystem: Former Biden Adviser
The South Dakota bill stands in stark contrast to the “State Anti-CBDC Surveillance Law” recently introduced in the US House of Representatives by Minnesota Republican Tom Emmer, considered a cryptocurrency advocate.
This is a big problem. The UCC is creating the framework for CBDCs to be accepted (and #bitcoin denied) through Amazon and all other retailers. All digital transactions.
This must be stopped. The good news is that we still have a chance to end this in the other 49 states. https://t.co/lUhcjsN11D
—Andy Roth (@andyroth) March 2, 2023
The UCC introduced the concept of “controllable electronic records” in amendments passed in July aimed at regulating digital assets at the state level. The new UCC articles also treat cryptocurrencies and CBDCs separately. The United States does not have a CBDC, although a “digital dollar” is under investigation within the US government and other groups, such as the Digital Dollar Project.
Juliette Moringiello, a member of the US Committee on Uniform Laws and the American Law Institute joint committee finalized the changes to the UCC, told Cointelegraph ahead of its finalization that the changes to the UCC “create giant security issues.” choice of laws, and if any company or anyone with cryptocurrency ends up in bankruptcy, a bankruptcy court would not know which law to apply.”
The proposed law would take effect on July 1, 2024, if approved.
