Lawmakers are sponsoring a bill that would make room for Hawaiian banks to give their customers’ digital services alongside with the existing financial services.
A bill was submitted by Hawaii lawmakers to allow banks to hold digital assets (cryptocurrencies) on behalf of their customers. They were to provide custody for digital and virtual currencies for their customers. This bill was sponsored by five (5) senators from the state of Hawai in the United states on; Sharon Moriwaki, Gil Rivere, Les Ihara, Kurt Fevella and Stanley Chang.
The bill sponsored by the democratic senators have passed first reading in the senate and it has been referred to the Senate Committee on Commerce, consumer Protection and Health and also the Senate committee on Judiciary.
Basically, the bill would make room for Hawai banks to give their customers’ digital services alongside with the existing financial services that US banks offer their customers. Banks in the US have always been skeptical about Bitcoin and adopting it because of the uncertainties. Again, they fear that it is sometimes used for illegal purposes, dark web transactions as well as criminal activities.
There have been occasions where people were held hostage and the kidnappers asked for their ransom in cryptocurrency, because of the difficulty to trace blockchain transactions. However, the bill would create legal clarity on how banks would be able to hodl cryptocurency alongside traditional money for their customers.
The bill seems to be a good move because it tends to put an end to the problem in the state of Hawai. Crypto financial services strive to survive because they are required to keep fiat equivalent of the digital assets they possess. This has been a challenge to crypto money services to find their footing and function in the state of Hawai.
Coinbase, for example, has declared that this decision led to its total shutdown of operations in the state in 2017. Again, it would give clarity to legal financial operations of banks in the state of Hawai.
The bill would be functional after 60 days of passage. In essence entails a low-cost and a pro-consumer system in which it is only customers that can authorize the banks to transact with their digital assets. Banks would have to perform all transactions with the customers’ interest and in their favor. They would also pay an annual fee of $1 and they would be audited by an external independent accountant. This account is required to check their digital books
HAWAIIAN BILL AND EFFECT ON CRYPTO ADOPTION
The opportunity to have your traditional money (fiat) and digital assets controlled by your local banks is one of the good decisions of the decade that would help propel the adoption of cryptocurrency all over the world. Having control over your fiat and digital asset from a source.
And there is guidance against the fear of centralization because you would be the one to authorize banks whether to transact with your assets or not. Some of these institutions see it as a stressful task having to use cold wallets to store their digital assets and they still have doubts on their security systems, but adopting banks would represent a significant step ahead.
Also, the issue of loss of cryptocurrencies after the death of the holder would become a thing of the past as there would be necessary details about the ‘next of kin’, so the family of the deceased would have access to the digital assets after the death of the person. The Hawaiian bill will see to increase in the adoption of crypto if implemented.