California was once the world leader in all things technology-related. The prime example of this is Silicon Valley and all of the major technology companies that were located there. For years now though California has suffered from a drain due to housing prices and companies relocating. When the Pandemic started and working from home became the norm even more people left the state to avoid the high tax rate.
In California, there is a ton of government regulation that does not bode well for crypto or blockchain companies. Possibly even worse for someone wanting to set up a crypto/blockchain company in California was the actual lack of rules and regulations. Since most industries are already heavily regulated it meant it was only a matter of time before this industry was regulated as well. With uncertainty companies will instead go to different places with clarity and we have seen this with both Miami and New York City attracting tons of developers.
To hopefully attract talent to the state once more the Governor of California Gavin Newsom signed an executive order Wednesday for state agencies to move in tandem with the federal government in crafting regulations for crypto and blockchain technology. The executive order's purpose is to make sure that the government does not lag behind technological advancements and to get ahead of the curve. This is kind of funny though because well as we can see governments across the world are already behind the 8-ball when it comes to this type of regulation.
When reading through the order and the different things it states it well seems to be a mixed bag of ideas. On one hand, this executive order is designed to move in lockstep with the Federal Government but the Federal Government is notorious for moving slowly with new technological regulations. The order does do some fantastic things like holding roundtable talks with crypto companies and industry leaders but whatever information gathered is then just going to be prepared by the different agencies involved and then submit their findings and recommend next steps. This will not help speed up the process, especially in a state like California which already has a ton of layers of bureaucracy in its state government. I will say though if this order had been issued in say 2017 this would be a completely different story since it is now being put out in 2022 regulators are already way way behind.
Currently, 37 states have some sort of pending or passed legislation when it comes to crypto and other digital assets. I bring this up because this order has been championed as creating the first state to begin examining how to broadly adapt to cryptocurrency and related innovations when I am not sure that is entirely the case. You have cities and states already adopting and utilizing crypto and blockchain tech to help their citizens and help further drive innovation. California is looking at this as a start from scratch idea. It would be a much easier and quicker way to utilize the states that have implemented legislation and learn from them about what did or did not work. Working with the Federal Government really limits their ability to be able to pass this legislation with any sort of urgency. It also means that what they implement might just completely fail and they would have to deal with broken legislation or legislation that again is behind the curve.
Following this order and seeing how quickly it is moved upon will be an interesting thing to see. The one good thing that did come out of it is that it did not ban or limit anything in this space and allows everything to continue as is.
Please know I am not a financial advisor I am just someone who picked up on a trend and wanted to express it! Makes sure you always do your own research and never invest money you cannot afford to lose! If you enjoyed this article and would like to further support me below are a couple of referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_
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